By Kirk Maltais
--Wheat for July delivery fell 2% to $6.26 3/4 a bushel on the Chicago Board of Trade on Friday, in reaction to news that Turkey won't receive wheat imports for the next four months in an effort to improve its own production of the grain.
--Soybeans for July delivery fell 1.9% to $11.77 1/2 a bushel.
--Corn for July delivery fell 0.7% to $4.49 a bushel.
HIGHLIGHTS
Feeling the Ripple: Turkey's suspension of wheat imports is likely to hurt Russia's prices, which may in turn translate to lower wheat export prices across the board. Turkey is a major buyer of wheat exports, mostly Russian. "Egypt's purchases of EU wheat [and] now Turkey's import ban will produce a slow start to the new crop Russian wheat export campaign," AgResource said in a note.
Reversing Course: Corn and soybeans resumed their slide, after snapping a seven-day losing streak on Thursday. Donna Hughes of StoneX attributed the decline to profit-taking from the previous day's rally, although wheat's slump also added pressure.
Welcome Change: The USDA confirmed a new flash sale of soybean exports to China, a change from the status quo of China bypassing the U.S. in favor of other exporting nations like Brazil. The purchase, which is for 104,000 metric tons for delivery in the 2023/24 marketing year, is seen as a reaction to the new tax being placed on Brazilian farm products, which has farmers there slowing down their selling. "China bought old crop beans. They might be nervous about this Brazil tax situation," Naomi Blohm of Total Farm Marketing said.
INSIGHT
Slight Cut: Next week's WASDE report is likely to show a small cut to the 2024/25 corn and soybean production forecasts, according to a survey of analysts by The Wall Street Journal. Analysts forecast corn production at 14.85 billion bushels, down from 14.86 billion bushels estimated by the USDA last month. Soybean production is seen at 4.44 billion bushels, down 6 million bushels from the previous month's forecast.
Tighter Budgets: The farm economy is looking at slimmer margins as a result of the high interest-rate environment, CoBank CEO Tom Halverson said. The cyclical movements of the agricultural economy have been more typical this year after recent chaotic years of trade strife and Covid-19, though lingering high interest rates are keeping farmers' budgets under pressure. "The interest-rate environment has taken everyone by surprise," Halverson said. CoBank, which provides financing to Farm Credit associations, projects farm income to fall 25% from last year, which is in line with USDA estimates.
AHEAD
--The USDA will release its weekly grains 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.
--The USDA will release its monthly World Agricultural Supply and Demand Estimates report at noon ET Wednesday.
Write to Kirk Maltais at kirk.maltais@wsj.com
(END) Dow Jones Newswires
06-07-24 1540ET
