Wheat Slides as Trader Optimism for Russian Quota Fades
By Kirk Maltais
-- Wheat for March delivery fell 1.1% to $6.60 3/4 a bushel on
the Chicago Board of Trade Thursday, falling after a hoped-for
Russian quota didn't materialize.
-- Soybeans for March delivery rose 0.1% to $13.70 1/4 a
-- Corn for March delivery rose 0.4% to $5.24 1/4 a bushel.
Fading Hopes: Wheat futures turned lower Thursday after starting
higher in the pre-market. Traders said the turnaround came after
optimism ebbed that Russia would move forward with a rumored quota,
opting to maintain its 50-euro duty put on its wheat exports
beginning next month. Russia is the top exporter of wheat
"The door remains open that Russia could put a quota on its
wheat exports at some point, but for now the Russian grain
industry/exporters have beaten back such harsh restrictions," said
Export Interest: New flash sales of U.S. exports announced
Thursday morning helped lift some grain futures. The USDA says that
136,000 metric tons of soybeans were sold to China for the 2020-21
marketing year, while 163,290 tons of soybeans were sold to Mexico
for 2020-21, 138,000 tons of hard red winter wheat were sold to
Nigeria for delivery in 2021-22, and 336,500 tons of corn were sold
for delivery to unknown destinations in 2020-21.
"The bottom line is that end users were willing buyers on this
week's price break," said Arlan Suderman of StoneX.
Last Minute: Waivers to the renewable fuel standard granted by
the EPA in the final hours of the Trump administration were stayed
by the U.S. Court of Appeals for the D.C. Circuit on Thursday,
pending "further order of the court."
The stay blocks the EPA's approval of two waiver petitions for
2019 and one petition for 2018, which would subtract another 260
million gallons of gasoline from the rules' blending requirements
for gasoline and ethanol, according to the Renewable Fuels
Turnaround: Export sales of U.S. soybeans are expected to bounce
back from lower levels reported in recent weeks, according to grain
traders surveyed by The Wall Street Journal. Traders project that
soybean sales for both the 2020-21 and 2021-22 marketing years will
total anywhere between 800,000 metric tons and 1.7 million tons.
Sales totaled a little over 1.2 million tons last week, so if
exports hit the high end they will well exceed last week's
With more flash sales of soybeans reported in the past week,
more exports reported in the USDA's weekly data will indicate that
higher CBOT prices aren't spurring demand rationing -- and that
prices need to travel higher to do so.
Confidence Game: The American Farm Bureau Federation said
Thursday that the USDA's National Agricultural Statistics Service
needs to consider ways to adjust the way it performs crop
"While NASS may have a gold standard reputation for agriculture
statistics globally, U.S. farmers' confidence in their reports has
unfortunately declined," said AFBF President Zippy Duvall.
Methods to adjust the agency's reports, which include the
monthly WASDE report, a chief mover of U.S. grain futures, include
adding transparency to "help farmers understand how the agency
arrives at the numbers," adapt new technologies to assist data
collection faster, and collaborate more with the Farm Bureau.
-- Railway operator Kansas City Southern is scheduled to release
its fourth-quarter 2020 earnings before the stock market opens
-- The USDA is due to release its monthly Cattle on Feed Report
at 3 p.m. EST Friday.
-- The CFTC is scheduled to release its weekly commitments of
traders report at 3:30 p.m. EST Friday.
Write to Kirk Maltais at email@example.com
(END) Dow Jones Newswires
January 21, 2021 15:59 ET (20:59 GMT)
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