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Dow Jones NewsApr 11, 7:53 PM UTC
DJ Wheat Futures Rise on Weaker Dollar -- Daily Grain Highlights
By Kirk Maltais
-- Wheat for May delivery rose 3.1% to $5.54 1/2 a bushel on the Chicago Board of Trade on Friday as a weaker U.S. dollar and improving sentiment around tariffs make grain futures more attractive for buyers.
-- Soybeans for May delivery rose 1.4% to $10.43 3/4 a bushel.
-- Corn for May delivery rose 1.4% to $4.89 1/2 a bushel.
HIGHLIGHTS
Better Showing: A weaker U.S. dollar index supported grain futures Friday. A weaker dollar makes grain exports more attractive on the world stage, making foreign currencies able to buy more product as a result.
"Suddenly, the grain and oilseed sector looks attractive to investors," said Arlan Suderman of StoneX in a note. He also notes that grains have gotten support with end users seeking to lock in cheaper prices as U.S. supply outlooks grow slimmer.
Can't Stand the Weather: Russian wheat growers were slammed by hail this week, compounding drought issues for crops there and crimping the availability of Russian wheat on the export market.
"Wheat has bullish traction on Black Sea dryness while CBOT soybeans enjoy unexpected non-China demand," said AgResource in a note.
The U.S. is also seeing warm and dry weather, which has farmers rushing to get their crops into the ground early but also limiting the amount of wheat they can plant. These factors helped push wheat futures more than corn or soybeans Friday.
INSIGHT
Alternative Crop: U.S. cotton growers may be considering switching their planting other crops after the USDA projected a 100,000 metric-ton reduction in cotton export sales in its April WASDE report, along with a 100,000-ton uptick in ending stocks.
The WASDE accounted for tariffs on Chinese goods by the U.S., along with retaliatory tariffs on U.S. goods by China. This has a large effect on U.S. cotton, as cotton is reliant on demand from China, more than other agricultural goods such as soybeans.
Also pressuring cotton futures were improved rainfall in southern growing regions, said Jack Scoville of Price Futures Group in a note.
Not Good for Business: The unfolding U.S.-China trade war threatens lasting economic damage to U.S. farmers, potentially forcing many more out of business, said Scott Metzger of the American Soybean Association. Metzger told CNN that farmers never fully recovered from Trump's first trade war with China in 2018, and another fight may push more out of business permanently.
"A fear that we have if this continues into the fall or even into next year, you know, there's a potential that there'll be some farms go out of business," Metzger said. "You know, you could have the next generation not want to come back or not able to come back just because of the economies or the farm situation in general."
Secret Buyer: The USDA reported a new flash sale of soybean exports for delivery in both the 2024-25 and 2025-26 marketing years, with 55,000 tons for delivery in 2024-25 and 66,000 tons for 2025-26, both sold to unknown destinations. "Unknown destinations" is a moniker often used by Chinese buyers, which is why the grains market tends to assume China is the real buyer of the product when it is used, although that isn't guaranteed.
What would make this purchase interesting is that it comes as tariffs on Chinese goods ratchet up, and China applies countertariffs to U.S. shipments.
AHEAD
-- The USDA is scheduled to release its weekly grain export inspections report at 11 a.m. EDT on Monday.
-- The USDA is due to release its weekly crop progress report at 4 p.m. EDT on Monday.
-- The EIA is scheduled to release its weekly ethanol production and stocks report at 10:30 a.m. EDT on Wednesday.
Write to Kirk Maltais at kirk.maltais@wsj.com
(END) Dow Jones Newswires
April 11, 2025 15:53 ET (19:53 GMT)
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