Wheat Futures Fall to 2017 Low on Oversupply Concerns

By Benjamin ParkinFeaturesDow Jones Newswires

Wheat futures tumbled to the lowest point this year as oversupply continues to erode prices.

Enormous global grain supplies and the competitiveness of global exporters such as Russia has left traders increasingly pessimistic on the direction of U.S. wheat prices.

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"Favorable weather in the Black Sea is allowing Russia to export record tonnages of wheat, which is stealing 'sales thunder' from the rest of the world's exporters," said AgResource Co. in a note to clients.

Russia recently produced a record wheat crop.

Wheat futures for March delivery fell 1.3% to $4.13 1/2 a bushel at the Chicago Board of Trade on Monday, the lowest close since late December 2016.

Regulatory data released last week showed funds continue to bet in large numbers that wheat prices will fall. The Commodity Futures Trading Commission said money managers held a net short position of 118,781 futures and options contracts.

The wheat market "just cannot seem to find a friend," said Dan Hueber, general manager of the Hueber Report.

Corn and soybean futures fell alongside wheat. CBOT March corn futures fell 1.1% to $3.49 a bushel while January soybean contracts slid 0.7% to $9.82 1/2 a bushel.

A slightly wetter turn in the weather outlook for Argentina, which is currently struggling with a lack of rain and drying crops, drove selling in soybean futures. Analysts said the risk of crop stress nevertheless continues to hang over Argentine corn and oilseeds.

Traders looked ahead to Tuesday's monthly supply-and-demand report, which many expect to show ongoing burdensome supplies.

Analysts surveyed by The Wall Street Journal expect the U.S. Department of Agriculture to raise its domestic soybean stockpile forecast for 2017-18 to 445 million bushels, 5% higher than its previous estimate, with its wheat stock forecast up under 1% to 941 million bushels. They expect the agency to trim its corn stockpile figure.

Write to Benjamin Parkin at benjamin.parkin@wsj.com

(END) Dow Jones Newswires

December 11, 2017 15:44 ET (20:44 GMT)