Agricultural Commodities: "Rabobank sees wheat and corn on 'race to the bottom'"

Rabo is historically better on this stuff than most of the other big banks.
For today however the headline crops are neck-and-neck to the upside.

	Last	Chg
Corn	343-0	+3-4
Soybeans	989-0	+15-2
Wheat	418-4	+3-4

From Agrimoney:

Rabobank slashed its outlook for feed grain prices, citing a "global feed grain glut".

Chicago feet[?] wheat and corn are on a 'race-to-the-bottom, thanks to heavy supplies and big harvests.

Rabobank forecast corn and wheat price well below the current forward curve.

Exceptional US harvest

Rabobank lowered its forecast for Chicago wheat prices, "record projected global feed supplies, ensuring a particularly competitive export environment". 

"Wheat prices fell significantly through late June, as exceptional US harvest prospects and heightened confidence in the US corn crop sparked a price race-to-the-bottom across feed grain cash markets," Rabobank said. 

"Both record US yields and near-record ending stocks… plus an impending EU feed-quality crop will contribute to a 2016-17 global feed grain glut," said the bank.

"Following the Northern Hemisphere harvest, wheat is expected to follow the corn market more closely, as both grains compete for demand."

Undershooting the curve

And Rabobank warned that the USDA's latest forecast for Chinese 2016-17 wheat feeding, at 15m tonnes "is somewhat optimistic in our opinion". 

"Government intentions to auction domestic corn stocks, having also removed the price support mechanism, should result in high availability of competitively priced Chinese feed corn, which could force a further 2m to 3m tonnes of wheat onto the global balance sheet," the bank said. 

Rabobank forecast Chicago wheat prices averaging $4.00 a bushel in the July to September period, and $4.30 a bushel in the October to November period....MORE

Meanwhile Inside Futures is in awe of the yields:

Wheat Treading Water

CURRENT STATE:

WHEAT: The latest provided by the Kansas City Harvest Report is only confirming what I’ve been claiming for the past six weeks, that is, this year is the mother of all harvests. The crop is now nearly 70 percent (average across states; Wyoming around 25 percent, South Dakota around 70 percent) harvested and my estimates of yield-per-acre are right in line with the actual as suggested by the harvest reports that are surfacing. Some farms in the Midwest (and as I’ve stated in earlier reports) are seeing up to 80+ bushels an acre. This is of course an anomaly when considering historical yields.

...MORE