The wheat complex concluded Friday’s trading session with modest weakness across key futures markets. Chicago SRW futures registered declines of 1 to 3 cents, while KC HRW futures saw more significant drops, trading down 7 to 8 cents by midday. MPLS spring wheat also reflected the broader market sentiment, posting losses of 2 to 3 cents at midday.
Export Sales Data Presents Mixed Signals
Recent Export Sales data revealed a nuanced picture for U.S. wheat. Old crop wheat commitments currently stand at 25.241 million metric tons (MMT), marking a 16% increase from the previous year. This figure represents 102% of the USDA forecast, indicating strong performance relative to official projections. However, this pace is slightly lagging the 103% average sales pace, suggesting that while commitments are robust, they are not exceptionally outpacing historical trends.
Conversely, new crop business has shown a considerable slowdown. Totaling 2.029 MMT so far, new crop sales are down 51.45% compared to the same week last year. This significant year-over-year reduction in forward sales for the upcoming harvest could be a contributing factor to the current market pressure, as traders assess future demand prospects.
International Developments Add to Pressure
Global supply indicators and policy changes also played a role in Friday’s market dynamics. In Europe, the French soft wheat crop is estimated to be in 80% good/excellent condition, according to FranceAgriMer. This rating remained steady from the prior week, signaling a healthy outlook for one of the world’s major wheat producers. French durum wheat also showed strong conditions, with 71% rated good/excellent.
Further impacting global supply expectations, Argentina announced a reduction in its wheat export tax late on Thursday. The tax was cut from 7.5% to 5.5%. This policy adjustment is likely to make Argentine wheat more competitive on the international market, potentially increasing global supply and exerting additional downward pressure on prices.
Detailed Futures Performance
Specific contract performances underscored the broad-based weakness observed across the wheat complex:
- Jul 26 CBOT Wheat closed at $6.45 3/4, down 1 3/4 cents.
- Sep 26 CBOT Wheat settled at $6.58 3/4, down 2 1/4 cents.
- Jul 26 KCBT Wheat traded at $6.80, a decrease of 7 cents.
- Sep 26 KCBT Wheat was at $6.90 1/2, down 7 1/4 cents.
- Jul 26 MIAX Wheat recorded $6.87 1/2, a loss of 2 3/4 cents.
- Sep 26 MIAX Wheat finished at $7.08 1/2, down 2 1/2 cents.
The Chicago Board of Trade (CBoT) is scheduled to be closed on Monday for Memorial Day, with a normal open anticipated for the Tuesday session. As the market heads into a holiday weekend, the confluence of mixed export data, robust international crop conditions, and competitive export policy changes from key producers like Argentina appears to have collectively weighed on wheat futures, leading to Friday’s modest but widespread declines.
