Grains were modestly lower overnight following Monday’s strong turnaround in prices. S&P futures were lower while crude oil was higher after Turkey shot down a Russian warplane overnight, increasing global tensions.
Wheat had the biggest losses overnight as USDA reported another uptick in US winter wheat conditions on Monday. Winter wheat is rated at 53% good-to-excellent versus 52% last week, but still off from last year’s reading of 58%. India’s wheat planting has been delayed by at least a week due to high temperatures, threatening its output of the grain yet again after hailstorms during harvest earlier this year dragged down annual production levels for the first time since 2007. Lower wheat acreage, down around 26% so far this season, in the world’s No. 2 wheat producer.
In Brazil, the northern region has seen less rainfall than normal as the region is running 30% below normal. While there was a spurt of rain in the past week that helped seeding activities, rainfall of late has been irregular and the forecast for rain is somewhat limited. Predicted totals range between 70-110mm, below the norm of 133mm for this time of year.
Ukraine’s corn harvest is likely to increase by 12% to 25.76 MMT next year due to a larger sowing area, analyst UkrAgroConsult said on Tuesday. Ukrainian farmers are likely to increase the area sown for the 2016 spring crops, including corn and oilseeds, after a severe drought forced them to cut the area sown for winter grains, UkrAgroConsult said in a statement.
Overnight, a Russian warplane was shot down by Turkey, which claimed the plane ignored the country’s airspace and repeated warnings. S&P futures (ESZ5) were lower on the news, while crude oil (GCLF6 / QMF6) was sharply higher on increased tensions.