There it is, the news that everyone expected but futures markets never factored in…apparently… The headlines sum it up, “Grain Futures Sink On Black Sea Grain Deal”, yes ladies and gentlemen, the extension of the Black Sea grain corridor came as a surprise to the futures market…..seriously…. Was it ever even in doubt. Maybe the headline should have read something more like “Algo traders sell market lower while waiting for a flat white”.

In the land of reality, the US wheat council crop tour of Kansas moved into its second day. Yield projections have been pretty much on pay with USDA estimates so far. The tour is starting to find more fields that will be, or are planned to be, abandoned though. The US winter wheat crop for 2023 is likely to see the highest level of abandonment that any winter wheat crop has seen in many, many years. Some say the highest level since 1917. At over 32% abandonment, much of that in western Kansas. Even the production estimates being calculated by the 2023 crop tour may still be well out. Crops being estimated with less than 10bu/ac may not even make it to the bin.
This kind of news continues to make many analysts concerned the new crop wheat production estimate for the US in this month’s WASDE could still be too high. The small increase of 260kt is starting to look less likely, if the findings in Kansas are a guide. The lie detectors enter the fields in 6-7 weeks.

Reuters reports this morning that the Black Sea grain deal has been extended for another 60 days, so we get to do all this again in the middle of the US wheat harvest. According to Russian UN ambassador, Vassily Nebenzia statement, it sounds unlikely that the demands Russia was insisting on prior to the extension were met in anyway.