Wheat markets bolstered by second major import tender this week

Wheat futures stabilised, supported by the second tender this week by a major importer, with rapeseed finding its feet too, helped by a leap in soyoil to fresh two-year highs.

 

Following on from Algeria’s purchase of 600Kt of wheat on Wednesday, Saudi Arabia unveiled a tender for 655Kt of the grain for delivery between May and July.

 

The further sign of importer interest, at a time when Turkey and potentially China are being monitored for signs they may come to market, bolstered markets still seen as gaining support from the exit by funds from short positions.

 

On Wednesday, open interest in Chicago soft red winter wheat futures fell below 450Kt for the first time in three months, a trend many sources view as fuelled by fund short covering as well as the looking expiry of the March-26 contract.

 

Chicago’s May-26 wheat lot added 0.5% in late morning deals, more than reversing losses of the last session, shrugging off some disappointing US export sales data for last week.

 

At 243Kt, sales for 2025/26 were below the 250-500Kt range that investors expected - reflecting a rise in US Gulf FOB prices as high as $250/t last week, a one-year top, in turn buoyed by the US’s strong wheat export performance for the season up to now.

 

US wheat export sales of 107Kt for 2026/27, as starts in June in the US, exceeded market forecasts.

 

Paris May-26 milling wheat futures headed for the close 0.6% higher, also more than reversing the last session’s losses.

 

London feed wheat futures for May-26 eased 0.2%, weighed by local supply pressure enhanced by robust UK December imports, and drier weather which has eased worries over harvest-26.

 

Paris rapeseed futures for May-26 added 0.3%, regaining only part of the 1.7% lost in the last session, and finding resistance at its 20-day moving average.

 

The headway echoed a modest 0.2% gain in Winnipeg canola for May-26, as some unease at the relatively sluggish pace of Canada’s exports confronted support from crude and vegetable oil markets.

 

Brent crude rose by 2.0%, setting course for what would be its highest close since July, amid jitters stoked by indirect talks in Geneva between Iran and the US in a bid to settle their longstanding nuclear dispute, and avert the risk of military conflict.

 

Soyoil futures for May-26 traded up 1.7% in Chicago to hit the highest level since September 2023 for a best-traded contract, on hopes for biodiesel demand after the US Environmental Protection Agency late on Tuesday delivered its latest Renewable Volume Obligation and Small Refinery Exemption proposals to the White House.