US wheat futures rallied slightly for a third consecutive session, and Dec CME settled above major technical resistance at $4.52, albeit very slightly. Russian fob offers are unchanged, EU offers are noticeably higher though, and with managed funds still short an estimated 85,000 contracts in Chicago, downside risk requires an improvement in world weather.
Western Australia will benefit from moderate rainfall in the next 10 days, but elsewhere only spotty precip is forecast into early Oct – certainly not enough to reverse the trend of declining soil moisture. There’s also more attention being paid to recent and upcoming dryness in E Ukraine and Russia. Assuming the current two-week outlook verifies, Sep rainfall in the Black Sea will rest at just 20-70% of normal – and large pockets of Ukraine and S Russia will see just 20-30% of normal rain in Sep. The CFS’s Oct precip outlook is attached, and ongoing dryness there is indicated.
US weekly export sales were a meager 11 Mil Bu, unchanged from last week and some 2 Mil shy of what’s needed to meet the USDA’s annual forecast. The US’s share of world trade is suffering as record shipments leave Russia, but US exporters have much better export opportunities beyond Nov/Dec. Target $4.80, Dec, to catch up on sales.