Prices of Russian wheat increased in the second week of September amid high demand, strong rouble currency, and worries about the extension of the Ukraine export deal.
On September 19, officials said that Moscow’s wheat with 12.50% protein content, for supply from the Black Sea ports, grew by $5.00 to $317.00 a ton free on board (FOB) at the end of last week.
Consequently, the price of US wheat futures for December delivery rose by 0.56% to $833.40 per metric ton.
Last week, Russia exported one million tons of grains, higher than the previous period’s record of 640,000 tons. This rise was driven by the lower wheat export tax, which supported traders’ margins.
The agriculture consultancy Sovecon forecasted that the wheat for immediate delivery would rise to $310.00 to $314.000 per ton.
Besides, heavy rainfall had arrived in parts of the country’s southern, central, and Volga regions last week. This phenomenon added to farmers’ already sown winter grain for the 2023 crop on 7.40 million hectares. It is lower compared with 8.50 million hectares recorded data around the same date last year.
Additionally, the agricultural consultancy IKAR had raised its Russian 2022 wheat crop projection by 2.00 million tons to 99.00 million tons.
On the technical side, the grain is traversing the support level and resistance zone of $827.10 and $834.30, respectively, on September 20.
Its current price of $833.40 per metric ton is higher than its five-day simple moving average of $830.41 and five-day exponential moving average of $830.33. Likewise, its 10-day SMA and 10-day EMA are at $829.19 and $832.57, respectively.
Based on the hourly chart, the Fibonacci Retracement points to a swing low of $823.63 and a swing high of $838.03, with a pivot point of $830.83.
Subsequently, the ultimate oscillator has a reading of 53.75, which suggests a strong buy position for the US December wheat contract.
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