Roundup: CBOT agricultural futures recover

0 Comment(s)Print E-mail Xinhua, June 12, 2022
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CHICAGO, June 11 (Xinhua) -- CBOT agricultural futures recovered this week as the Russia-Ukraine conflict looks to continue into 2023, Chicago-based research company AgResource noted.

AgResource holds that world grain prices could rise amid tightening supplies.

CBOT corn recovered the entirety of the previous week's losses, with Ukraine not expected to be a sizeable grain exporter this summer and autumn and expectations of harsh weather in the Central U.S. Strong and expansive high-pressure ridging will be in place across the Central U.S. into late June. Rapid and widespread soil moisture loss lies ahead, and the weather pattern's duration remains critical.

Interior U.S. cash markets have soared since early June. This, along with ongoing substantial export disappearance, suggests old crop stocks will be extremely tight, which raises a burden on yield performance.

In the near term, the July contract is expected to trade in a range of 7.50-8.25 U.S. dollars. September and December contracts may turn explosive if wetter and cooler weather fails to return beyond the next two weeks. The outlook on corn remains bullish. Ukraine's absence from the market will be felt more intensely by late summer and early autumn.

World wheat futures recovered by varying degrees this week, with spot Kansas wheat taking over near-term bullish leadership. The U.S. Department of Agriculture (USDA) in its June report lowered U.S. hard red winter wheat production by another 8 million bushels, and recent heavy rainfall across the Southern Plains has triggered questions over regional quality.

Soft red winter wheat yields in the Delta are surprisingly disappointing. The North American high-protein wheat balance sheet will be extremely tight in 2022-2023. The market will not tolerate long periods of heat and dryness across the Northern United States and Canada.

Nothing came from this week's Russian-Turkish meeting in Turkey. Ukrainian wheat exports will be minimal indefinitely. Ukraine typically begins to dominate global trade in July. Exportable world wheat stocks will be reduced to bare minimums in other exporting countries, including the United States. Seasonal lows have been formed. New price plateaus are forecast by early to mid-autumn, with new highs in CBOT and Kansas markets probable in 2022.

Soybean futures rallied ahead of the June World Agricultural Supply and Demand Estimate (WASDE) report, marking historic prices. Spot futures traded at the highest price since September 2012, stopping just short of all-time highs.

The June estimate report was bullish, with the USDA increasing old crop exports and cutting old crop stocks to 205 million bushels. The June Acreage and Grain Stocks reports will be released at the end of the month.

The Crop Progress report released last week showed that planting progress had reached 78 percent. It is expected that 90-92 percent of the crop will have been planted through Sunday. The USDA indicated that initial crop condition ratings would be released on Monday. AgResource maintains that July soybean futures should reach new historic highs. Enditem

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