On Monday, Chicago wheat futures dropped but still held on its nearly four-month high due to weather concerns in Russia, Europe, and the US.
US wheat contracts for July delivery slipped by -0.24% to $620.60 per metric ton in the Asian afternoon session. It marked a slight decline to $624.00 from the previous close.
Last week, the adverse weather conditions grew worries that the supply could experience a 10.00% reduction.
Russia, the top wheat exporter globally, forecasted that it would see a threat of drought in May. It would mainly affect the eastern half of the Southern Federal District.
According to analysts, the country’s drying trend could pose a significant issue for grain and other winter crops. They added that major exporters, Moscow’s southern region and Ukraine’s east, might encounter deficient soil moisture, impacting their supply.
Russia’s agriculture ministry has stated that the country’s grain harvest could slide to 132 million metric tonnes from 2023’s 144.9 tonnes.
Moreover, freezing weather conditions in some parts of Europe exacerbated supply concerns. The European Commission cut its crop forecast for 2024/25 to a four-year low.
On Friday, CBOT wheat marked its seventh consecutive daily price gain, driven by speculative investors buying back some of their substantial short positions.
Punjab Protests Due to Declining Wheat Prices
Punjab’s agricultural region is preparing for a province-wide protest campaign against the government’s apathy to lower wheat prices. Farmers struggle with unscrupulous private buyers as the authorities have yet to handle its market.
The protesting faction declared their intent to escalate the situation in response to seemingly alarming developments in the wheat harvesting season. They also cited manipulation by hoarders, middlemen, etc., as a cause of significant losses for farmers.
Ayub Mayo, a prominent Punjab farmer, underlined the authorities’ indifference. He criticized the lack of a tangible process despite the government’s promises of a favorable policy for farmers.
Additionally, Mayo stressed the urgent need for just wheat prices through timely procurement to ease planters’ worries.
