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Wheat Futures Slump as Investors Weigh Higher Global Supplies

April 11, 2018 at 17:33 by Andrew Moran

Investors are beginning to weigh their exposure to wheat as global supplies remain sufficient. Wheat futures are slumping on the figures, despite reports of cold weather threatening US crops and industry output.

May wheat futures dipped $0.02, or 0.41%, to $4.90 per bushel at 17:08 GMT on Wednesday on the Chicago Board of Trade (CBoT). Wheat, which is trading at a one-month high, has had a strong start to 2018 as the commodity has climbed more than 11% year-to-date.

Traders are starting to reduce their positions because of ample wheat stocks in the international market. The decrease in demand kept wheat under pressure throughout the trading session. But cold temperatures impacting the US Midwest could reverse the trend in the near-term.

The latest weather forecasts show cold temperatures will affect the region, and any frost damage could impact crops. In addition to frigid temperatures threatening current crops, experts warn that weather patterns may delay planting of the nation’s spring crop.

Wheat exports from the US and the European Union (UN) could take a hit amid a sliding Russian rouble. The US Department of Agriculture (USDA) projects that Russian wheat exports could reach 38.5 million tonnes, while industry observers peg the figure at 40 million tonnes this year.

With trade relations between the US and the rest of the world up in the air, the domestic agricultural sector is getting worried.

Other agricultural commodities are mixed in the middle of the trading week. July soybean futures surged $0.04, or 0.38%, to $10.54 per bushel. May corn futures slipped $0.0175, or 0.45%, to $3.875 a pound. May orange juice futures rose $0.01, or 0.72%, to $1.3925 a pound. July coffee futures advanced $0.055, or 0.46%, to $1.201 per pound.

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