US Wheat Extends Losses as Strong Dollar Clouds Export Outlook

News Agencies December 19, 2024

(Bloomberg) — Wheat tumbled as a strong dollar and concerns about oversupply pushed prices lower for a sixth straight trading session in Chicago.

Most Read from Bloomberg

Traders shrugged off a US government report showing better-than-expected export sales for the week ended Dec. 12, sending futures down as much as 1.9% to the lowest level since late August. A rallying dollar is hurting the outlook for sales as a strong greenback can dent the appeal of crops abroad.

The benchmark wheat contract is down about 15% since the start of the year amid concern about excess global supplies in 2025. Global wheat production is set to be the highest on record in 2024-25, according to the US Department of Agriculture, with Australia on track for a bumper crop and yields better than expected in some parts of Argentina.

Hard red winter wheat, which is used for making bread flour and is the most widely grown variety of the grain in the US, also is down for the year.

“Wheat farmers in the US planted winter crops under good conditions,” said Price Futures Group grain broker Jack Scoville. “Australia has seen too much rain recently that has downgraded wheat quality, but Australia still has a very big crop to sell into world markets.”

Chicago wheat as of Wednesday is on its longest losing streak since late June. Yet downward momentum could be limited by a smaller crop from Russia, the world’s biggest exporter. Consultant SovEcon this week trimmed its forecast for the nation’s 2025 production to the lowest since 2021.