By Joanna Levin
THE downward trend in US wheat prices continued last week. Wheat contracts for May closed last Friday (April 3) at a contract low of 311¢/bushel (187p/bushel), down 10¢/bushel on the previous week.
Farmers in the USA intend to plant less wheat than expected this year. USDA planting estimates total just 27 million hectares – well below most traders estimates and 1.6m hectares down on last season.
Despite lower-than-expected wheat planting, stocks are still high, with 1998 year-end levels projected at 20-25m tonnes. The only previous year when stocks exceeded 19m tonnes was 1990. This gloomy picture of oversupply is depressing prices further and driving many smaller farmers out of business.
Better weather in the western belt of the USA last week drove wheat prices down and the region is now enjoying ideal growing conditions. Higher temperatures in the Great Plains and Midwest have reduced fears of frost damage to the winter wheat crop.