Wheat prices on the futures market in Chicago increased again on August 12 after the release of the new Wasde report. The September contract for common wheat rose by 3.6% to 753.5 cents per bushel, about € 236 per tonne.
This means that the wheat price of this supply contract is approaching the peak of early May. In the peak on May 7 of this year, the September contract was paid 762.25 dollar cents per bushel, a difference of about € 2 per tonne. The price of the most expensive contract at that time (delivery in May) was then another € 4 per tonne higher.
In short, with the publication of the new Wasde report, the market has suddenly returned to the sentiment of early May. This week’s insights assume lower harvest expectations in Russia, Canada and the United States than previous forecasts.
In Russia, the acreage of winter wheat now appears to be smaller than previous statements. A slightly higher production of spring wheat can hardly compensate for the lower production of winter wheat. In addition, estimates of hectare yields for wheat in Russia have also been lowered based on reports from the Russian Ministry of Agriculture. As a result, the wheat harvest estimate in Russia has been lowered by 12.5 million tons to 72.5 million tons.
Compared to the previous estimate, the wheat harvest in Canada is 7.5 million tons lower, bringing it to 24.0 million tons. Due to severe drought in July, Canada is now reckoning with the smallest wheat crop since 2010-11.
Slightly higher yields are now expected in Ukraine and Australia. An increased acreage pushes wheat production in Ukraine to a new record of 33.0 million tons. In Australia, the estimate of wheat production is being increased by 1.5 million tons to 30.0 million tons because continued precipitation has a favourable effect on production.