Wheat Closes Mostly Lower on Thursday

Wheat futures saw mixed performance Thursday, with Chicago SRW down 3-5 cents and Minneapolis spring wheat down 3-4 cents, while Kansas City HRW contracts were fractionally mixed. Export sales data revealed old crop net reductions of 13,373 MT, but new crop sales exceeded estimates at 882,202 MT, marking a marketing year high and the largest combined sales since December 2023. The International Grains Council reported steady world wheat output for 2025/26 at 806 MMT, with consumption down 1 MMT and stocks up 2 MMT to 262 MMT.

Analysis

Wheat futures exhibited a predominantly softer tone on Thursday, with Chicago SRW contracts declining 3 to 5 cents and Minneapolis spring wheat futures falling 3 to 4 cents; Kansas City HRW contracts were an exception, showing fractionally mixed performance, as exemplified by the September 2025 contract gaining 1/4 cent while the July 2025 contract eased by 1/2 cent. This price action occurred despite significantly strong new crop export sales for the 2025/26 marketing year, which totaled 882,202 MT, surpassing the estimated range of 300,000 to 700,000 MT and marking a marketing year high. These robust forward sales, with combined old and new crop sales being the largest since December 2023, signal healthy future demand, particularly from unknown destinations (153,300 MT), the Philippines (137,000 MT), and Japan (102,400 MT). Conversely, old crop export sales registered net reductions of 13,373 MT, a figure that fell within market expectations. The International Grains Council's latest outlook for 2025/26 projects steady global wheat output at 806 MMT, a slight 1 MMT decrease in consumption, and a consequential 2 MMT increase in ending stocks to 262 MMT, potentially tempering immediate price upside despite the positive new crop sales figures.

Key Decisions for Investors

• Investors should monitor the interplay between robust new crop export demand, which signals future strength, and the current pressure on nearby futures contracts potentially influenced by old crop adjustments and slightly higher global stock forecasts.
• The contrasting signals of strong forward sales against near-term price weakness and increased global stock projections may warrant consideration of spread trading strategies between different contract months or wheat classes.
• Vigilance is advised regarding the follow-through on new crop export purchases, particularly the significant volume attributed to 'unknown destinations', as subsequent clarification could materially influence regional price dynamics and overall market sentiment for the 2025/26 season.