Wheat Recovers From 16-Month Low, US Weather Limits Gains
Wheat Recovers From 16-Month Low, US Weather Limits Gains

Wheat Recovers From 16-Month Low, US Weather Limits Gains

  • 27-Jan-2023 3:23 PM
  • Journalist: Harold Finch

USA: Although gains were limited by snowfall in some areas of the US Plains, which provided the winter crop with much-needed moisture, Wheat prices have risen slightly in the US as the market rebounded from its lowest point in 16 months on bargain purchasing. Beneficial snowfall could also increase crop moisture in the US, which would be negative for Grain pricing. Despite this, the Wheat market was under pressure after snow and rain fell over the US, moistening the region's parched winter harvests.

As a European business index and corporate profits boosted expectations that a dramatic slowdown in the global economy may be avoided, earlier share prices remained close to multi-month highs, and the dollar stayed around a nine-month low against the euro. Strictly yes, traders believed Wheat futures to be oversold, making them vulnerable to short-covering increases. The above-mentioned reasons have further increased the price of Wheat in the US.

After falling to its lowest level since September, the most active Wheat contract on the Chicago Board of Trade (CBOT) increased by 0.82% to $7.15-1/2 a bushel. In October, prices for Wheat futures skyrocketed to their highest point in two months in the US market. This year, the domestic US market produced 546 million spring and durum Wheat bushels, a 48.2% increase over last year's output. However, the production drop of winter Wheat brought on by the drought countered the rise.

According to the ChemAnalyst database, the price of Wheat has marginally climbed in the domestic US market, and corn and soybean prices have grown for the first time in five seasons. Moreover, the prices of Wheat have also globally increased following the government's delay in releasing more inventories to increase supply and calm the local market that was struggling from shortages brought on by last year's lower output, Wheat prices in India reached a record high.

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