Wheat Market Outlook - February 5, 2024

As prices fall, there is a declining likelihood of further decreases, but at the same time, there are indications of more distressed sellers trying to generate cash to pay for spring inputs given expensive storage and finance costs. Heat and dryness are noted in India, but given last season’s experience, the market will be reluctant to react too aggressively. Poor crop prospects in North Africa support notions on imports. Meanwhile, the EU and Black Sea countries need to find a record nine million mt per month of export demand to reach current export forecasts before new crop arrives. This somehow needs to be achieved with two conflicts being fought along the supply chains to the Middle East and Asian markets. Traders are concerned about the developments in the Middle East and about geopolitical disputes in general. This kind of environment will keep markets steady to lower, but as cheapest food grain, we could see wheat firmer than corn. We would be fully sold durum and wait a little to see if we get some spark in spring wheat.