Wheat, soy decline

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CANBERRA- Chicago wheat on Wednesday shed some gains from the previous session as plentiful supply and falling Russian export prices weighed on market sentiment, pushing US futures towards multi-year lows.

Soybean futures also dipped and corn edged higher, with both contracts close to their lowest levels since December 2020.

Ample supply of Russian wheat, Brazilian soybeans and US corn have pressured prices, and the US government last week forecast a sharp increase in US end-of-season stocks of all three crops.

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The most-active wheat contract on the Chicago Board of Trade (CBOT) was down 0.2 percent  at $5.78 a bushel, having surged 3.3 percent  on Tuesday.

Traders attributed Tuesday’s rally to a bout of short-covering triggered by a weakening dollar which makes US farm products more affordable for importers, and anticipation that Washington may impose new sanctions on Russia.

Commodity funds have built large net short positions in wheat, soybeans and corn, leaving them prone to short-covering rallies.

CBOT wheat is still down around 8 percent  so far this year and is near September’s three-year low of $5.40.

“The general trend has been downwards,” said Andrew Whitelaw at consultants Episode 3 in Canberra.

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