USDA confirms more cancellations of US soft red wheat sales to China
CHICAGO, March 11 (Reuters) – Private exporters canceled sales of 264,000 metric tons of U.S. soft red winter wheat that had been booked for delivery to China, the U.S. Department of Agriculture (USDA) confirmed on Monday.
It was the third cancellation in as many business days and the largest of the three, following two cancellations last week totaling 240,000 tons of soft red wheat sold to China.
Wheat prices have fallen since China made a series of U.S. wheat purchases in December. The price break reflects strong competition from global suppliers, particularly Russia, the word’s biggest wheat exporter, and improved crop conditions in the U.S. winter wheat belt.
China last week expanded its budget to stockpile grains and edible oils this year, as it aims to reduce its dependence on imports and improve food security.
Benchmark Chicago Board of Trade soft red winter wheat futures Wv1 dipped to $5.23-1/2 per bushel after the USDA’s announcement on Monday, the lowest on a continuous chart of the most-active contract Wv1 since August 2020.
The benchmark contract is down about 19% from a four-month peak reached in early December at $6.49-1/2, around the time China’s weekly purchases of U.S. wheat hit an all-time high. Chinese importers also made sizable purchases of French and Australian wheat last autumn after rain damaged China’s wheat crop.
In a monthly supply/demand report on Friday, the USDA cut its estimate of U.S. wheat exports in the marketing year begun June 1, 2023, to 710 million bushels, down from 725 million a month earlier and the lowest in 52 years. The 15-million-bushel reduction included 10 million bushels of soft red winter wheat exports.
Source Link: https://www.nasdaq.com/articles/usda-confirms-more-cancellations-of-us-soft-red-wheat-sales-to-china
