China Cancels 504,000 MT Shipments Of U.S. Wheat

China canceled another batch of US wheat export shipments, adding to an already record number of cancellations that have weighed on Chicago futures, reported Michael Hirtzer and Tarso Veloso for Bloomberg News.

Wheat futures fell as much as 2.7% to $5.235 a bushel after the announcement, the lowest intraday level since August 2020, before prices turned higher.

The US Department of Agriculture (USDA), in a Monday statement, said private exporters exited purchases of 264,000 metric tons (MT) of US soft red winter wheat to China.

It was the third straight session with such an announcement, bringing the cancellation total to 504,000 MT, the most in USDA data going back to 1999, as also reported by Dominic Carey and Keira Wright for Bloomberg News.

Wheat futures fell as much as 2.7% to $5.235 a bushel after the announcement, the lowest intraday level since August 2020, before prices turned higher.

“Those cancellations show that China can get wheat cheaper from others,” said Ben Buckner, chief grains analyst for AgResource Co. Still, wheat futures recovered by late morning.

Abundant world crop supplies have been pressuring prices for months, but because money managers already had such sizable bearish positions, the market has been struggling to stay down as traders cover their short bets.

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