Wheat futures posted gains on Wednesday as traders moved into positions ahead of a U.S. Department of Agriculture monthly supply and demand report set for release on Friday. The scheduled report will include the agency's estimates for acreage and stocks at the end of June, and market participants were preparing for the data.
Benchmark contract moves were modest but broadly positive. CBOT September soft red winter wheat climbed 1-3/4 cents to $6.20-1/4 per bushel. In Kansas City, September hard red winter wheat rose 4-3/4 cents to $6.57-1/2 per bushel. Minneapolis September spring wheat increased 4-3/4 cents to $6.37-3/4 per bushel. Soybean futures also moved higher in tandem with the gains in wheat as traders anticipated the USDA release.
The forthcoming USDA report will contain the agency's end-June acreage and stocks estimates, data points that markets often use to re-assess supply balances. Traders appeared to be positioning ahead of the numbers, contributing to the upward movement in grain prices on Wednesday.
Separately, Ukraine's largest farmers' union, the Ukrainian Agrarian Council (UAC), flagged weather-related risks to harvesting. The UAC's trading department said that rain expected over the next week in western, northern and central parts of Ukraine could slow the harvesting of barley and wheat and could negatively affect grain quality.
The combination of a pending USDA supply snapshot and weather concerns in a major grain-producing region underscored the near-term uncertainties facing the market. Participants highlighted the potential for headline risk around the report and for harvest delays to affect available supplies and quality, factors that can influence trading activity in both the cash and futures markets.
Contextual note: The USDA report referenced in this article is the monthly supply and demand report that includes end-June acreage and stocks estimates. The weather outlook cited was reported by the trading department of Ukraine's largest farmers' union, the UAC.