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Commodity futures

US Wheat Futures Expected to Open Lower on Monday

Strategic Insights

— 2 min read

US wheat futures are expected to start the day lower following overnight weakness and lower calls in other grain markets. The market will be closely watching the action in corn and soybeans, as well as the potential impact of Hurricane Dennis on the driest areas of Illinois. The USDA's supply and demand report on Tuesday is also expected to influence trade, with analysts noting that trade could be two-sided ahead of the data release.

Key Takeaways:

  • US wheat futures are expected to open 2 to 3 cents a bushel lower on Monday.
  • July wheat fell 6 1/4 cents to $3.28 1/2 and September wheat fell 2 1/2 cents to $3.34 3/4 a bushel in e-cbot trade.
  • Wheat traders will watch the action in corn and soybeans as the market continues its role as a follower.
  • Corn and soybean markets are watching the path of the remnants of Hurricane Dennis and whether the storm will bring any moisture to the driest areas of Illinois.
  • At most, rains from the storm will reach the southern edges of the eastern corn belt, according to Meteorlogix.
  • Light technical support for September wheat is seen at $3.35 and then $3.32.
  • Traders will be positioning ahead of the USDA's supply and demand report on Tuesday.
  • Winter wheat harvest is seen at 70%-75% complete in the latest weekly crop progress report.
  • Spring wheat conditions are likely to be unchanged with a week ago, with 81% of U.S. spring wheat rated good-to-excellent last week.
  • Taiwan seeks 92,200 metric tons of US wheat in a Tuesday tender for August-September shipment from the Pacific Northwest.
  • There were 108 contracts delivered against the July wheat contract, with Century Group Division of Refco delivering 69 and ABN Amro stopping 83.
  • Overseas news shows that freight rates continue to fall, which is expected to ease premiums on wheat in Asia.
  • Domestic prices for wheat in China rose slightly as farmers limit marketing in hopes for higher prices.

Statistics:

  • 2-3 cents: expected decline in US wheat futures on Monday.
  • 6 1/4 cents: decline in July wheat in e-cbot trade.
  • $3.28 1/2: price of July wheat.
  • 2 1/2 cents: decline in September wheat in e-cbot trade.
  • $3.34 3/4: price of September wheat.
  • 70%-75%: estimated completion of winter wheat harvest.
  • 81%: percentage of U.S. spring wheat rated good-to-excellent last week.
  • 92,200 metric tons: amount of US wheat sought by Taiwan in a Tuesday tender.
  • 108: number of contracts delivered against the July wheat contract.
  • 69: number of contracts delivered by Century Group Division of Refco.
  • 83: number of contracts stopped by ABN Amro.

Sources:

  • Dow Jones Commodities News via Comtex
  • Meteorlogix
  • USDA (US Department of Agriculture)
  • Taiwan Government Tender Notice
  • Century Group Division of Refco
  • ABN Amro
  • Dow Jones Newswires

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