Wheat Market Outlook

The trade remains focused on the general lack of demand in the global markets. There are some potentially problematic production spots in Europe, but right now, all the major origins have wheat to sell, and demand is lack-luster. In Canada, the trade is watching for the announcement (or lack thereof) of tariffs on Canadian products following the U.S. Presidential Inauguration. Mercantile suggests...

According to Mercantile, the strong U.S. dollar is proving to be a challenge for U.S. wheat prices, but strong corn and soybean markets will drag wheat along to a degree. Mercantile says importers will increasingly shift their attention to Southern Hemisphere wheat as stocks dwindle in the Black Sea and the strong U.S. dollar elevates U.S. prices. Global prices are significantly lower than last ye...

Mercantile says - arguably the most important takeaway from last week’s WASDE report was that global wheat stocks are at their lowest level since 2017/18. On the one hand, wheat markets face a strong U.S. dollar and an unsteady demand prole. On the other hand, 2025 exports from the EU & Russia could be 15 million mt lower than last year’s, while Indian domestic prices hit new highs, and their...

According to Mercantile, MATIF and U.S. futures found some support at the contract lows, but U.S. wheat is expensive compared to other origins. Black Sea wheat remains comparatively cheap, and Argentina is also working to take more demand, says Mercantile. Meanwhile, end users are not well covered, but they remain reluctant to buy as the very strong U.S. dollar and weak currencies of importing nat...

Mercantile discusses how the wheat market is becoming increasingly complex. The global wheat production outlook is mixed. Political interference will be a major feature moving forward. There is uncertainty about the impacts of the Russian export quota, and the potential policies of the Trump administration. The very strong U.S. dollar and weak currencies in importing nations is not helping demand....

According to Mercantile, wheat is drifting lower given the lack of supportive news. The Algerian tender two weeks ago, and the GASC tender this week, show that even with Russia out of the public tender business, there is lots of available wheat in the Black Sea. Mercantile says South American crops are coming online which will add to the competition. Mercantile adds there is uncertainty about how...

According to Mercantile, the U.S. election will be the feature of the week stating both candidates have campaigned on more protectionist policies, especially regarding China. Mercantile says Russian traders seem to have enough private business to keep them busy while the remaining Eastern European countries seem willing and able to fill the public business. In Mercantile’s opinion, wheat lacks ind...

According to Mercantile, Black Sea wheat remains the cheapest in the world, and Russian traders appear to be willing to ignore the government’s price floor. Wheat markets benefitted from the strength in corn and soybeans, but with little independent strength, Mercantile assumes wheat will be confined to a sideways range for now. Mercantile recommends targets to sell 25 per cent of their wheat prod...

According to Mercantile, Russian officials seem determined to tighten controls on the wheat market. Early indications are that traders are complying, but even with the increase in prices, Mercantile says Russia remains one of the cheapest origins for wheat on a FOB basis. Mercantile says the amount of relief (or lack there of) the rain brings to the winter wheat areas of the U.S. and Russia will b...

According to Mercantile, the trade will be watching the dryness in the U.S. winter wheat belt as well as how much relief the rain will bring to the Russian winter wheat crop this week. The trade is not certain how the recent Russian restrictions will impact trade, so this will be a feature moving forward. Mercantile would sell 25 per cent of spring wheat at $8.00 per bushel 2CWRS 14.5 percent prot...

According to Mercantile, wheat futures increased across all three exchanges on Monday, as well as Russian FOB prices in the last week. The annual Small Grains Summary showed all wheat production at 1.9 billion bushels, which was down 11 million bu from the August Crop Production report. Year-to-date U.S. shipments sit at 8.2 million mt which is just more than 35 per cent higher than this time last...

According to Mercantile, the wheat market is decently supported as harvest pressure eases. With that said, Mercantile believes wheat prices will remain under pressure until values firm in the Black Sea and dryness in the Black Sea, the U.S., and Australia will need to be watched. Mercantile would store wheat and avoid additional sales until 2025.

Mercantile says despite today’s profit taking, the wheat market remains supported. The balance sheet is getting tighter according to Mercantile, and growers are getting more grain into storage which will need better bids to get it out. End users remain uncovered whilst borrowing is a problem for many. Mercantile still expects higher prices in the New Year and would hold wheat sales for now.

Mercantile does not see a reason for changes, unless they find a big change in the WASDE report. Weather conditions in South America remain poor and Mercantile does not see reasons to be enthusiastic about North American production. Europe is down, while markets have been on the lower end for the last three years. If cash flow is not a problem, Mercantile would use storage and not make further sal...

According to Mercantile, the market went into the long weekend buoyed by the week’s gains. However, Mercantile will watch if Black Sea values follow suit. Spot markets may have printed seasonal lows, but few are willing to pay the record carries. Mercantile expects futures to stabilize or maybe get stronger, as the weather forecast is not great. The carrying charges in the markets encourage grower...

Mercantile expects grain markets to hold steady as Europe has mostly completed harvest. According to Mercantile, disputes in the Middle East look to be escalating as cargo vessels are under attack in the Persian Gulf. Meanwhile, prices will stay low for now while demand is outweighing the farmer rate of retention. Mercantile says Russian exporters remain aggressive as their February to June quota...

According to Mercantile, U.S. wheat export sales are running 32 percent ahead of last year. However, Mercantile expects markets to remain under pressure from harvest. Meanwhile, buyers are reluctant to commit to deferred positions due to the large carry increasing later delivery prices. When crops are in the bin, Mercantile sees prices firming.

According to Mercantile, Algeria and Egyptian demand give a bit of support, as well as smaller production in Europe. Some of this will be offset with large crops in Canada, the U.S., and the southern hemisphere, but there is a chance that we are approaching a floor in the wheat market. The USDA report is expected to show larger wheat production in the U.S., but smaller global supply. The markets r...

According to Mercantile, harvest pressure will be prevalent in the wheat markets in the short-term. Smaller crops in Europe are being met with weak demand and the potential of good crops in the Southern Hemisphere. Mercantile says Russian wheat remains the cheapest origin and good crops in the Baltic states will prevent Russian prices from appreciating much. According to Mercantile, traders are tr...

According to Mercantile, harvest pressure in Europe will lead cash prices, but weather should keep North American prices from falling much. Mercantile thinks the funds will continue covering their shorts. Mercantile would leave wheat sales alone for now.

According to Mercantile, weaker crops in Europe are being met with strong harvest results in the U.S. There was good demand last week, but all the tenders were fulfilled with Black Sea wheat. Mercantile says there is lots of uncertainty with Biden stepping down and escalations in the Middle East to name only few. Generally, markets don’t like uncertainty so, Mercantile’ s logic says markets should...