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Technical analysis July 28
Wheat prices on the CBoT fell from $8.03,75 to $7.90,25 per bushel in the last trading session. The price of wheat was under some pressure due to good yield forecasts for spring wheat in the northern US. The estimated yield in North Dakota and parts of South Dakota and Montana is approximately 30% above the five-year average. Developments in Ukraine also dampened the mood on the wheat market. Despite the rocket attacks on Odessa and Mykolaiv, Ukraine continues to prepare for exports across the Black Sea. Although the ships are not yet sailing and there are still many ifs and buts before that actually happens, optimism about the grain deal regained the upper hand on the market.
The quotations for corn and soy took another step up on the American stock exchange. The August soy contract closed at $15.78,75 per bushel and the September corn contract closed at $6.00,25 per bushel. The weather reports are closely monitored by players in the corn and soy trade. July and August are important months in the development of the crop.
The amount of precipitation in the Corn Belt has been disappointing so far. Significant rain is still not expected and weather models predict that temperatures will rise further in early August. Analysts expect that warm weather to cause damage to corn and soy. This week, in the Crop Progress report, the USDA lowered the acreage of corn and soybeans that were given good or excellent status. A further reduction is expected in the coming week. According to analysts, the part of the area that is rated good or excellent in the Crop Progress report could fall to the lowest level in five years next week.
Jurphaas Lugtenburg
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