Wheat price estimates were lowered by Rabobank to the lowest quarter-average level in almost four years based on increased global inventories. Despite cold weather in North America possibly damaging U.S. wheat seedlings and disrupting logistics, favorable conditions in the rest of North America and other regions such as the EU and the Black Sea are expected to create an overall 20 million ton year on year increase in worldwide wheat stockpiles. Rabobank has also upgraded its forecast for soybeans based on extremely tight supplies in the U.S., strong demand from China, continuing logistical hurdles to be faced in Brazil, and a continuing trend of crop retention by growers in Argentina who have sold forward only 6.4% of the next soybean crop compared to 14% a year ago. Rabobank has projected cotton prices will be up based on the U.S. Department of Agriculture’s (USDA) prediction that U.S. stocks ending 2013/14 will be down 23% to 3 million bales and U.S. cotton exports are expected to reach 10.5 million bales for the season. However, as stocks increase in Australia and Brazil and planting increases in the U.S. over the course of the year, prices are expected to retreat.
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