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Wheat Climbs on Indications of Tighter Supply -- Daily Grain Highlights

09/24/2021 | 03:44pm EST

By Kirk Maltais

--Wheat for December delivery rose 0.8% to $7.23 3/4 a bushel on the Chicago Board of Trade Friday amid indications of tighter supplies globally.

--Soybeans for November delivery rose 0.1% to $12.85 a bushel.

--Corn for December delivery fell 0.5% to $5.26 3/4 a bushel.


Streak of Success: Wheat futures climbed again in trading today, the third consecutive day that wheat has risen. The outlook for tighter supplies globally continues to be a driving force for futures. "Wheat prices erased early losses to drift higher amid tightening global supplies of milling wheat, amid fears that USDA might further tighten the spring wheat supply when it posts its Small Grains Summary Report on Thursday," said Arlan Suderman of StoneX.

Policy Watch: Corn futures fell today amid concerns that the Biden Administration will make big cuts to existing biofuel blending mandates for oil refineries, which is seen as hurting the demand for U.S. ethanol, a major consumer of domestic corn. "Corn prices are under pressure on concerns the Biden Administration will slash biofuel requirements for U.S. refiners ... ethanol accounts for around one third of corn demand," said Robert Yawger of Mizuho Securities USA. In a story published Wednesday by Reuters, the EPA is seen as reducing blending mandates by roughly 2-3 billion gallons.


Story of Selling: Today's commitment of traders report from the CFTC, which will be released after the market closes today, is expected to show selling by the large funds of long grains positions, said Charlie Sernatinger of ED&F Man Capital. Mr. Sernatinger projects that managed money funds will have sold 4,000 lots of soybeans, 9,000 lots of soyoil, 4,000 lots of corn, and 6,000 lots of wheat. These traders don't seem to be worried much about next week's quarterly stocks report from the USDA, Mr. Sernatinger adds. "The trade is largely expecting a snoozer on corn and bean stocks, but a friendly tone to the wheat, which includes final spring wheat production," he says. "It has been a long time since we have had a demonstrably bearish report from the USDA."

Hanging on the Sidelines: Grains traders today were largely tentative with CBOT futures, with trading volumes staying light ahead of what's expected to be a busy weekend for harvesting. One factor at play is farmers deciding what to do with the crop they harvest, said AgResource. "Some cash corn is being sold in the Plains/Missouri, but otherwise, producers are storing or filling contracts which has forward cash bids firming," says the firm -- also highlighting that ethanol plants in the Midwest are starting to increase their bids in order to incentivize more farmers to sell new crop.


--The USDA will release its weekly export inspections report at 11 a.m. ET Monday.

--The USDA will release its weekly crop progress report at 4 p.m. ET Monday.

--The EIA will release its weekly ethanol production and stocks report at 10:30 a.m. ET Wednesday.

Write to Kirk Maltais at kirk.maltais@wsj.com

(END) Dow Jones Newswires

09-24-21 1543ET

Stocks mentioned in the article
ChangeLast1st jan.
CORN FUTURES (C) - CBR (FLOOR)/C1 0.88% 572 End-of-day quote.20.04%
WHEAT FUTURES (W) - CBR (FLOOR)/C1 0.61% 778.5 End-of-day quote.26.07%
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