📜 Wheat Prices Recover as Short Covering and Weather Concerns Support Gains 📜
After Monday’s losses, wheat prices rebounded on Tuesday on short covering and weather concerns in the U.S. Midwest and Eastern Europe. The March contract at Euronext rose by €0.25 to €229.75/t, while September gained €3 to €239.50/t, reaching its highest level since October 3. CBOT wheat futures also climbed, with the March contract up 4.75 cents to 604.75 ct/bu (€209/t), marking a four-month high. Weak export demand continues to weigh on the front-month contracts, while later contracts benefit from speculation about potential crop damage.
📊 1. Market Overview: Euronext & CBOT Prices
| 📅 Contract | 💰 Closing Price | 📉 Change | 📊 % Change |
|---|---|---|---|
| Euronext March 2025 | €229.75/t | +€0.25 | +0.1% |
| Euronext September 2025 | €239.50/t | +€3.00 | +1.3% |
| CBOT March 2025 | 604.75 ct/bu (€209/t) | +4.75 ct | +0.8% |
| CBOT July 2025 | 620.75 ct/bu (€214.6/t) | +1.00 ct | +0.2% |
📌 Front-month contracts remain weak due to sluggish exports, while later contracts rise on supply concerns.
🌍 2. Key Market Drivers & Influence Factors
🔹 📌 Short Covering & Speculation Drive Market Up
📈 Hedge funds and commodity traders, who had previously built large short positions, are covering their bets amid increasing uncertainty over crop conditions in the U.S. and Russia.
🔹 Cold temperatures in key growing regions could potentially damage crops, leading to a rally in later-month futures contracts.
🔹 Front-month contracts remain under pressure due to weak export demand and high global wheat availability.
🔹 🌡️ Weather Conditions in Key Regions
🇺🇸 U.S. Midwest & Great Plains
📍 Current: Freezing temperatures pose a potential risk to winter wheat, although snow cover is protecting fields in some areas.
📆 Forecast (Next 14 Days):
- ❄️ Sub-zero temperatures expected in Kansas and Oklahoma – potential winterkill risk.
- 🌤️ Mild conditions returning after February 25, reducing damage potential.
🇷🇺 Russia & Ukraine
📍 Current: Cold wave affecting Black Sea wheat-producing areas.
📆 Forecast (Next 14 Days):
- 🌡️ Severe frost in Central & Southern Russia.
- 🌧️ Dry conditions in Ukraine raise concerns over spring planting.
🔹 📦 Weak Export Demand Limits
📉 EU wheat exports remain sluggish:
🔹 EU soft wheat exports for the 2024/25 season reached 13.33 million tons by February 16, but remain 36% lower than last year (20.8 million tons).
🔹 Germany’s wheat exports increased by 50,000 tons last week to 1.5 million tons.
📦 U.S. wheat exports also underperformed:
🔹 USDA’s weekly export report showed only 249,812 tons of wheat shipped for the week ending February 13.
🔹 This was below expectations (300,000–500,000 tons) and marked a 56% drop from the previous week.
🔹 Cumulative U.S. wheat exports for 2024/25 are now at 14.85 million tons (+22.4% YoY).
🔹 📉 Russia’s Lower Stocks Could Tighten Supply
📍 Russian grain stocks are 27.3% lower, with wheat inventories down 31.5%.
🔹 Export quotas introduced on February 15 are expected to restrict Russian wheat shipments, which could tighten global supply later in the season.
🔮 3. 3-Day Market Price Forecast
📉 Expected Price Ranges for the Next 3 Days:
| 📅 Contract | 🔮 Price Range |
|---|---|
| Euronext March 2025 | €228 – €232/t |
| Euronext September 2025 | €238 – €242/t |
| CBOT March 2025 | 600 – 610 ct/bu (€207 – €210/t) |
📌 Factors influencing price movements:
🔹 Short covering may continue, supporting further gains.
🔹 Weak demand & high inventories could cap rallies in front-month contracts.
🔹 Weather risks in Russia & the U.S. remain a bullish factor.
⛅ 4. 14-Day Weather Forecast for Key Growing Regions
🇷🇺 Russia & 🇺🇦 Ukraine (Black Sea Region)
📍 Current: Cold snap threatening winter wheat.
📆 Forecast (Next 14 Days):
- 🌡️ Extreme frost is expected in Central & Southern Russia.
- 🌧️ Ukraine faces persistent dry conditions, which could delay spring planting.
🇺🇸 U.S. Midwest (Kansas, Oklahoma, Nebraska)
📍 Current: Winter storm conditions in key wheat-growing areas.
📆 Forecast (Next 14 Days):
- ❄️ Cold conditions will persist through Feb 25, increasing winterkill risks.
- 🌤️ Gradual warming after Feb 25 could ease concerns.
📉 5. Long-Term Market Data: Stocks & Production Outlook
📍 Global Ending Stocks for Wheat (2021–2025)
| 📅 Season | 🌎 Global Ending Stocks (Mio. t) | 📉 Change |
|---|---|---|
| 2021/22 | 311.5 | – |
| 2022/23 | 301.0 | -10.5 Mio. t |
| 2023/24 | 295.8 | -5.2 Mio. t |
| 2024/25 | 290.3 | -5.5 Mio. t |
📍 Wheat Production Estimates for 2024/25
| 🌍 Country | 📅 2023/24 (Mio. t) | 📅 2024/25 Forecast (Mio. t) | 📉 Change |
|---|---|---|---|
| 🇺🇸 USA | 385 | 384 | -0.3 % |
| 🇨🇳 China | 290 | 292 | +0.7 % |
| 🇷🇺 Russia | 91 | 87 | -4.4 % |
| 🇪🇺 EU | 126 | 128 | +1.6 % |
📌 6. Conclusion & Recommendations
📍 Key Takeaways:
✅ Wheat prices recover after short covering, but front-month contracts remain under pressure.
🌡️ Weather risks in Russia & the U.S. keep markets volatile.
📦 Weak EU & U.S. exports limit upside potential.
📌 Trading Strategy:
🔹 Producers: Consider locking in new crop prices at current levels due to market uncertainty.
🔹 Buyers: Monitor weather developments and export flows before committing to large purchases.
🔹 Traders: Expect continued volatility, with speculative activity driving price swings.
📍 Markets will remain sensitive to weather risks and export trends over the coming weeks.