Wheat declines, erasing advance, as Russia, Ukraine likely to add to supply

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SINGAPORE, Apr 16 (Bloomberg): Wheat futures declined for the fifth straight day on speculation that higher shipments of the grain from Ukraine may boost global supply. Corn and soybeans also fell. Ukraine has the potential to boost grain exports to 22 million or 23 million metric tons in the season starting July 1, from about 11 million tons this season, Serhiy Feofilov, the head of researcher UkrAgroConsult, said Friday. "There's an expectation that a good Northern Hemisphere crop will weigh on prices," Simon Clancy, manager for the export brokerage at FCStone Australia Pty., said by phone from Sydney. "We're already seeing signs of that out of Russian and Ukrainian markets." Wheat for July delivery declined 6.5 cents, or 0.8 per cent, to $7.6975 a bushel by 10:40 a.m. London time on the Chicago Board of Trade. It is set for a 7.5 per cent loss this week. Milling wheat for May delivery on NYSE Liffe in Paris fell 2.255 euros, or 1 per cent, to 235.50 euros ($340.56). Grain harvests in Russia may range between 80 million tons and 88 million tons this year, the Institute for Agricultural Market Studies said Friday. That compares with the institute's estimate of 84 million tons in February. Russia banned grain exports from Aug. 15 to at least July 1 as drought wiped out 37 per cent of its crops. Russia was the world's second-largest exporter of wheat in the 2009-2010 season, before grain crops in the country suffered from the worst drought in at least half a century. Soybeans fell on speculation South American inventories will be larger than previously expected, increasing exportable supplies of the oilseed. South American soybean production will rise 1.3 per cent to a record 141.4 million tons this year, researcher Oil World said in a report this week. Exports from Brazil, the world's second- biggest shipper behind the U.S., will rise 13 per cent to 33 million tons, Oil World said. Soybeans for July delivery declined 7.25 cents, or 0.5 per cent, to $13.355 a bushel in Chicago, set for a 4.9 per cent loss this week. July-delivery corn lost 8.25 cents, or 1.1 per cent, to $7.5275 a bushel in Chicago. The contract is set for a 2.7 per cent loss this week, the first weekly decline in five.