Wheat sank on bleak US export forecast

Note: This section contains information in English only.
Source: Dukascopy Bank SA
Farm commodities plunged on Wednesday despite improved demand for riskier assets after the Fed announced additional stimulus measures. However, weak demand for US grains and rising production of softs in South America and China offset optimism over US economy, sending rural commodities lower.

Wheat dipped after the USDA cut its outlook on US wheat exports in 2012-13, citing tough competition on international market. Adding pressure on the commodity, the USDA revised upward its estimate of world's inventories by 1.6%.

Corn was underpinned by dismal US ethanol production data. US ethanol output dropped 11,000 barrels per day on a weekly basis. Moreover, an increased competition from Brazil weighted on the US export sales prospects.

Sugar tanked to 28-month low on signs of oversupply on the market. Brazil's production is expected to climb almost 5% in the year started March 1, stated Conab. Meanwhile, China's output jumped by annualized 47% in November.

Coffee was the top-loser as favorable weather is likely to boost Brazilian crops. Depressing coffee prices further, Mexican coffee exports advanced 41% year-on-year last month, reported the national association of coffee growers.


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