After wavering for the better part of today, whet prices’ break-out on the upside is apparent. As at 13.54 GMT, wheat futures were up by 1.35% to trade at $605.77. Investors seem to have looked past the predicted increase in global wheat production. The bulls’ focus is on China’s imports and the lowered US supplies.
On a 4-hour chart, wheat prices’ break-out on the upside has come after wavering for the better part of today. The market has been reacting to Thursday’s WASDE report, which was not bullish enough. According to the US department of agriculture, the commodity’s average farm price remains at $4.70 per bushel.
At the global level, the 2020/21 wheat outlook includes an increase in supply. The forecast also comprises higher exports and consumption, and a reduction in stocks.
The department adjusted its estimates of global wheat supplies by +1.2 million tonnes to 1074.3 million tonnes. The adjustment followed the increase in global production, which is currently at a record 773.7 million tonnes.
USDA expects Russia, Canada, and Australia to record increased production in the 2020/21 crop season. In Australia, production is likely to rise by 1.5 million tonnes to reach 30 million tonnes. As for Russia and Canada, the agency predicts that the wheat output will increase by 500,000 tonnes and 0.2 million tonnes respectively.
In the US, the department’s December outlook for the 2020/21 season comprises a slight reduction in supply, increase in exports, and stagnant domestic consumption. Lower imports have contributed to the reduction of supplies by 5 million bushels.
On the other hand, the agency has adjusted exports by +10 million bushels. Shipments of white wheat have been on the rise. Conversely, those
