The correlation between wheat futures prices and crude oil has ticked higher in recent months, partly due to freight and transport costs. This inter-market relationship is influencing hedging strategies. Tuesday’s USDA quarterly stocks report will be key in providing greater insight into supply and demand over the last quarter. A Reuters survey of grain analysts shows the average estimate for Sept. 1 U.S. corn stocks, at 1.337 billion bushels, would be a four-year low and down 24% from a year earlier. However, the analysts’ collective estimate is above the 1.325 billion bushels USDA projected for 2024/25 corn ending stocks in its Sept. 12 monthly supply and demand report. In the European Black Sea region, FOB 12.5% FOB Constanta, Varna, Burgas (CVB) cargoes were up on the week by $3.75 per tonne to $234.50 per tonne, while 11.5% wheat on an FOB CVB basis rose on the week, up by $3 per tonne to $230 per tonne. Global trade dynamics continue to underpin wheat futures prices, with rising import demand from Southeast Asia adding incremental support to U.S. and EU contracts.
