Wheat Falls After Egypt Cancels Tender
June 15 2021 - 3:46PM
Dow Jones News
By Kirk Maltais
-- Wheat for July delivery fell 1.9% to $6.61 1/2 a bushel on
the Chicago Board of Trade Tuesday after Egypt's grains buying
authority canceled a previously announced tender.
-- Soybeans for July delivery fell 0.4% to 14.65 3/4 a
bushel.
-- Corn for July delivery rose 1.2% to $6.67 1/2 a bushel.
HIGHLIGHTS
Canceled Purchase: Wheat futures led row crops lower Tuesday
after Egypt's state grains buying service canceled a tender for
purchasing foreign wheat for unknown reasons.
"Traders speculate that high [shipping] prices likely caused
Egypt's public wheat importer to shy away from a purchase," said
AgResource.
Egypt canceled a tender one other time this year, which was
because of high prices.
According to AgResource, grain traders sold 8,500-9,000
contracts of wheat Tuesday as of midday.
Crop Drop: Monday's crop progress report showed a slide in crop
quality for U.S. grains, which ended up having little effect in
supporting grains futures. Corn crops in good-to- excellent
condition are down to 68% from 72% last week.
Meanwhile, soybeans are down to 62% from 67% last week and
spring wheat is down 1 point to 37%.
"Prices were unable to profit from this -- apart from those in
the front-month contracts, which did so briefly -- as they remain
under the influence of forecasts of better weather for the
foreseeable future," said Commerzbank.
INSIGHTS
Turning Higher: Production of ethanol in the U.S. is expected to
stay on the rise this week, according to analysts surveyed by Dow
Jones. If production rises to the high end of analyst expectations
-- to roughly 1.08 million barrels per day -- it will be the
highest U.S. ethanol production has been since late February of
last year, prior to the Covid-19 pandemic hitting the U.S.
Meanwhile, analysts surveyed expect stocks to rise to anywhere
from 20.06 million barrels to 20.56 million barrels. If they do
rise to the high end of expectations, it will be the highest stocks
have been since early April.
Crushed Expectations: Soybeans crushed in the U.S. rose in May,
according to data from the National Oilseed Processors Association.
NOPA reported Tuesday that the soybean crush rate hit 163.5 million
bushels in May, up from 160.3 million bushels in April.
However, the rate is lower than forecast by analysts, said Terry
Reilly of Futures International. "The lower-than- expected U.S. May
soybean crush and end-of-May soybean oil stocks is viewed
supportive for soybean oil, in our opinion," he said.
Soyoil futures closed down 0.6% Tuesday to 65.57 cents per
pound.
New Wave of Aid: U.S. farmers impacted by the coronavirus
pandemic will receive additional aid payments totaling at least
$2.6 billion, the Agriculture Department said Tuesday.
USDA said in a notice it is allocating the funds to agricultural
producers that may have missed previous aid, as well as continuing
to help sectors that have been hurt most by the pandemic. According
to the USDA, biofuels producers are in line to receive $700
million, while small timber-harvesting businesses are up for $200
million in payments.
Dairy farmers are also in line to receive additional
funding.
An unspecified amount of aid is scheduled to go to livestock
producers as well, including those that were forced to euthanize
animals because of the pandemic's impact on the economy in
2020.
AHEAD
-- The EIA is scheduled to release its weekly ethanol production
and stocks report at 10:30 a.m. EDT Wednesday.
-- The USDA is due to release its weekly export sales report at
8:30 a.m. EDT Thursday.
-- The CFTC is scheduled to release its weekly commitments of
traders report at 3:30 p.m. EDT Friday.
Write to Kirk Maltais at kirk.maltais@wsj.com
(END) Dow Jones Newswires
June 15, 2021 15:45 ET (19:45 GMT)
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