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U.S. grains: Soybeans and corn firm, but wheat weak

Wheat weakens as high prices cut off demand

Chicago | Reuters –– U.S. soybean futures rose 1.3 per cent on Tuesday, rebounding from Monday’s sell-off on a round of bargain buying and some position squaring ahead of a report that will show how big demand from domestic crushers was in April, traders said.

Corn futures also were firm, following soybeans higher, but gains were capped by a pickup in the pace of planting around the U.S. Midwest following weeks of delays.

Wheat futures sagged as funds liquidated long positions on poor export demand for U.S. supplies. Chicago Board of Trade soft red winter wheat has fallen for five days in a row, shedding 4.5 per cent during that time.

“The problem is, U.S. wheat is expensive on the global scene,” said Jim Gerlach, president of A/C Trading. “We have got to find a level that makes it competitive again.

“USDA told us Friday there’s plenty of wheat globally; it’s just not going to be here in the U.S., necessarily, so buyers are going to find cheaper alternatives.”

CBOT July soft red winter wheat fell 5-3/4 cents at $7.09-1/4 a bushel. CBOT wheat’s losing streak was the longest since prices fell for seven days in a row in early November.

CBOT July soybean futures were up 18-1/2 cents at $14.83-3/4 a bushel and broke through resistance at their 30-day moving average. The closely watched July-November spread widened by 11-3/4 cents a bushel due to concerns about domestic supplies running out before harvest.

“What we are looking at is continued tightness in old-crop (soybeans),” said Chris Robinson, senior trader at Top Third Ag Marketing. “There is some thoughts out there that although we are bringing soybeans up into the Gulf, it may not be enough to take off that pressure.”

The National Oilseed Processors Association will release its monthly report on crush data and oilseed stocks on Thursday. The last report showed processors remained active throughout March, recording the heaviest crush for the month since at least 2001.

CBOT July corn was up 3-1/4 cents at $5.02-3/4 a bushel. Corn futures hit resistance at their 40-day moving average after rising during the overnight session.

The U.S. Agriculture Department said on Monday afternoon that corn planting was a better-than-expected 59 per cent complete as of May 11, up from 29 per cent a week earlier and one percentage point ahead of the average mid-May pace from 2009 to 2013.

Soybean planting was 20 per cent complete, up 15 percentage points from last week but one percentage point behind the five-year average.

— Mark Weinraub is a Reuters correspondent covering grain markets from Chicago. Additional reporting for Reuters by Julie Ingwersen in Chicago.

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