Wheat ends lower with a weekly loss amid supply glut

Wheat futures declined on the Chicago Board of Trade during Friday trading, ending the week down by 1.1%, as abundant global supply stemming from ongoing harvests in the Northern Hemisphere overshadowed the strength of US exports.

Corn futures also fell after US export sales triggered a round of short-covering in the previous session, recording a weekly loss of 1.7% amid expectations of a bountiful harvest in the United States.

Soybeans also declined by 1.3% during the week, after US weekly export sales came in at the lower end of trade estimates.

Strong US wheat sales

Net US wheat export sales for the week ending July 17 totaled 712,000 metric tons, a figure at the high end of trade estimate ranges.

US wheat is now cheaper than European or Russian wheat (the latter having started to flow into the market from its major harvest), noting that CBOT wheat prices fell in May to their lowest level in five years at 5.06¼ dollars per bushel.

In the same context, participants in the annual crop tour of North Dakota expected the average yield of spring red hard wheat in the top-producing state to reach about 49.0 bushels per acre, which is a drop from the record 54.5 bushels reported last year.

However, those figures remain above the five-year average, according to Rabobank analyst Vitor Pistoua, who added: “There are still strong crops coming from that region.”

Pistoua noted that as the Northern Hemisphere harvest season progresses, it is "unlikely that supply expectations will change," pointing out that abundant corn supply and low prices are also putting pressure on the wheat market.

He said: “Nobody is expecting a price increase.”

Corn and soybean exports

As for corn, the US Department of Agriculture (USDA) announced on Thursday export sales of 135,000 tons to South Korea and 284,196 tons to unknown destinations.

Soybeans came under additional pressure from weakness in the soymeal market on Thursday, following reports that Chinese buyers purchased additional volumes of Argentine soymeal, although prices regained some strength on Friday.

Corn

In trading, corn futures for December delivery ended the session down by 0.4% at $4.19 per bushel.

Soybeans

Soybean futures for November delivery fell by 0.2% to $10.21 per bushel.

Wheat

Wheat futures for September delivery settled down by 0.4% at $5.38 per bushel.