Wheat prices continue to fall despite forecasts of a significant reduction in U.S. seeded acreage
The U.S. Department of Agriculture released this year's first acreage forecast, according to which corn and wheat acreage will decrease in 2024 compared to last year, while soybean acreage will increase because it is more profitable to grow it, even though prices have fallen to multi-year lows.
According to the USDA forecast, the area planted under corn in the United States will decrease compared to last year from 94.6 million acres to 91 million acres, although analysts estimated it at 91.6 million acres, and under wheat - by 2.6 million to 47 million acres At the same time, soybean acreage will grow by 3.9 million acres to 87.5 million acres, while analysts estimated it at 86.7 million acres.
Despite the USDA's forecast coming in behind analysts' average estimates, corn and wheat prices continued to fall, even more so than soybeans.
On the Chicago Stock Exchange, March corn futures yesterday fell another 1.5% to $164.5/t (-3% in two days), while soybeans fell just 0.7% to $427.1/t t (-2.1% in two days).
March U.S. wheat futures were also lower yesterday despite the forecast for a decline in planted acreage, as follows:
- by 3.3% to $208.3/t - for soft winter SRW wheat in Chicago,
- by 2.1% to $211.6/t - for hard winter HRW wheat in Kansas City,
- by 0.7% to $241.8/t - for hard spring HRS-wheat in Minneapolis.
Prices are under pressure from improved weather and the outlook for soybean and corn harvests in South America, as well as weak export sales from the United States.
According to StoneX, South Korean MFG bought 68,000 tonnes of South American or South African corn for early June delivery at $238/t C&F, while Algeria bought 120,000 tonnes at $230/t C&F.
