Wheat closes with its biggest weekly loss in six months

Wheat futures in Chicago fell on Friday to close with their biggest weekly drop in six months as abundant supplies from the Black Sea region weighed on prices, analysts said.

Soybean and soymeal futures rose amid growing concerns about drought in Argentina, the world’s top exporter of processed soybean oil and meal. Soybeans were also oversold after losses earlier in the week, according to analysts.

“Friday’s weather maps had removed some of the rain that had been forecast earlier this week in Argentina,” said Terry Linn, an analyst at Linn and Associates. “Soybeans and flour are leading the way, they’re super sensitive to that.”

The most active wheat contract in Chicago ended down 3.25 cents at $7,435 a bushel. For the week, wheat lost 6%, its biggest drop since July.

The most active soybeans rose 21.75 cents to $14,925 a bushel and ended the week down 2%. Corn gained 1.25 cents to $6.54 a bushel and lost 3.6% for the week.

“We started last week with three days of strong sales across the whole grain complex, including soybeans,” Linn said.

Poor harvest weather in Argentina should support corn futures prices of $6.40 to $6.50 a bushel, said Tomm Pfitzenmaier, an analyst at Summit Commodity Brokerage.

“Dry weather in Argentina is a constant concern and will be a supportive factor until there is a change in the weather pattern,” he said.

As for wheat, the availability of large, low-priced supplies from Russia and the Ukraine is creating tough competition for other global exporters, traders say.

Reports of a record crop expected for Australia, the world’s second largest exporter of the grain, also weighed on prices.

“The wheat market appears to be amply supplied in the near term,” Commerzbank said in a note.

This week the US Department of Agriculture will publish quarterly data on grain reserves and monthly data on supply and demand on January 12.