Wheat Approaches 14-Month Low After WASDE

Chicago wheat futures fell below $7.2 per bushel, approaching the 14-month low of $7.05 hit on December 6th after the USDA’s WASDE report for December reduced its forecast for global consumption for the 2022/23 marketing year.

The report revised its projections downwards by 1.6 million tonnes to 789.5 million for the period, mainly due to lower feed and residual usage in the EU and Ukraine.

On the other hand, supply expectations were also revised downwards due to lower production in Argentina and Canada.

Still, strong overall global supply added to bearish pressure.

The harvest for top exporter Russia was the highest on record in the current marketing year, extending competition into North America.

Also, shipments from Ukraine continued after Russia agreed to extend the UN-brokered deal that guarantees a trade corridor for vessels carrying Ukrainian grain in the Black Sea for another four months, significantly reducing shortage concerns.