Wheat Declines on Muted WASDE Response -- Daily Grain Highlights
December 09 2022 - 3:40PM
Dow Jones News
By Kirk Maltais
--Wheat for March delivery fell 1.6% to $7.34 1/4 a bushel on
the Chicago Board of Trade Friday, as the WASDE report from the
USDA showed mostly expected results, with many forecasts left
unchanged from the previous month.
--Soybeans for January delivery fell 0.2% to $14.83 3/4 a
bushel.
--Corn for March delivery rose 0.2%, to $6.44 a bushel.
HIGHLIGHTS
Subdued Reaction: Grain futures trading on the CBOT were
generally muted following the release of the USDA's WASDE report,
instead slowly slipping lower. Much of the muted reaction stems
from limited changes to existing forecasts by the USDA in the
report. "USDA opted to leave South American production unchanged
from a month ago despite the rough start to the Argentine growing
season," said Doug Bergman of RCM Alternatives in a note. "Overall,
nothing too shocking in the numbers today."
Hitching a Ride: Strength in crude oil prices provided a boost
for most grain futures early in the trading session. "The outside
markets are generally supportive with the crude oil and equity
market trading higher, but the dollar slightly lower," Tomm
Pfitzenmaier of Summit Commodity Brokerage said in a note this
morning. However, oil eventually lost its sheen, with the contract
closing down 0.6%.
INSIGHTS
Eyes on the Prize: What allowed wheat futures to lead the way
down was a lack of post-report momentum, which in turn did little
to reverse the selling trend seen in wheat since October. The
most-active contract fell close to a low established earlier this
week--which is the lowest the contract has traded at since July
2021.
Lingering Problem: Friday's WASDE report did little to assuage
concerns about longer-term corn demand. In its report, the agency
forecast an ending inventory of 1.26 billion bushels of corn for
the 2022/23 marketing year. That's up 75 million bushels from the
USDA's previous estimate in last month's report. The uptick in
ending stocks comes from a cut made to expected export sales, the
USDA said in the report. "Competition from other exporters and
relatively high U.S. prices have resulted in slow sales and
shipments through early December," it added.
AHEAD:
--The USDA will release its weekly grains export inspections
report at 11 a.m. ET Monday.
--The EIA will release its weekly ethanol production and stocks
report at 10:30 a.m. ET Wednesday.
--The USDA will release its weekly export sales report at 8:30
a.m. ET Thursday.
Write to Kirk Maltais at kirk.maltais@wsj.com
(END) Dow Jones Newswires
December 09, 2022 15:25 ET (20:25 GMT)
Copyright (c) 2022 Dow Jones & Company, Inc.