Local wheat markets have retraced lower in the wake of the USDA report released late last week. The USDA report showed a significant reduction to corn yields to 123.4 bushels per acre, decreasing the total US corn crop by 55mmt since the last report to 273.79mmt (which was largely in line with market expectations). The report was viewed as mildly bearish for wheat with the USDA actually increasing its US wheat production forecast to 61.73mmt which is a 13% increase on last year’s production. It should also be noted that harvest progress on US soft red winter wheat was also ahead of schedule. As a result wheat prices have come off their recent highs and have trended lower throughout the week just gone. The relatively high AUD has also kept the lid on local grain prices. Carry reflected in the CBOT wheat market is currently providing opportunities for growers to price wheat forward at premiums to spot pricing.