Wheat futures have managed to recover the $6 per bushel level, below which they briefly dipped last week.
 
However, the current downtrend remains in place; prices at the beginning of the year stood at $8.71 per bushel, so the latest rebound in prices does little to affect the steady losses this commodity has endured throughout the year. Risk appetite had been improving all week following Thanksgiving, and yesterday’s coordinated move by the world’s major central banks has put markets firmly on the front foot. Also supporting wheat prices were downgrades to the expected quality of Australian wheat following unseasonal rains in New South Wales. The heavy rain will reduce the wheat content and cut the quality of exports from Australia, the world’s fourth-largest exporter of wheat.
 
Traders interviewed by Agrimoney.com reported that a number of market participants had taken the rally as an opportunity to close out short positions, thus helping to lift wheat futures yet further. If tomorrow’s US non-farm payrolls numbers manage to emulate the ADP figures yesterday and come in significantly ahead of expectations, then the rally in risky assets, including wheat, will have further to go, although (as usual) we can’t discount the possibility of more bad news from the eurozone doing its bit to derail risk appetite.