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U.S. grains: Wheat, corn, soy rally after finding technical support

Also, snow in forecast for northern U.S. Midwest

Chicago | Reuters — U.S. corn, soybean and wheat futures rose on Tuesday, rebounding from weakness in the overnight session after finding technical support, traders said.

Wheat notched the biggest gain, with the benchmark Chicago Board of Trade soft red winter wheat contract rising 2.3 per cent. The contract rebounded from early weakness after finding support near its 20-day moving average.

“(Wheat) caught some chart buying as it became clear we would score an outside day higher on the bar charts,” Charlie Sernatinger, global head of grain futures at ED+F Man Capital, said in a note to clients.

Soybean futures peaked at their highest level since July 19, wheat hit its highest price since Aug. 11 while corn hit its highest since Aug. 12.

Forecasts for a snowstorm in northern stretches of the U.S. Midwest also added support to prices, as the wintry weather raises the prospect of crop damage and further delays to an already slow harvest.

“Harvest will advance as quickly as possible for the first half of this week, before problematic weather arrives to put an abrupt halt to that,” Matt Zeller, director of market information at INTL FCStone, said in a note to clients.

Chicago Board of Trade November soybean futures ended up 5-1/4 cents at $9.20-1/2 a bushel (all figures US$). Prices traded lower before finding support at the contract’s 200-day moving average.

CBOT December corn was up 8-3/4 cents at $3.95-3/4 a bushel.

CBOT December soft red winter wheat was up 11 cents a bushel at $5.00-1/4.

The storm was expected to drop between six and 12 inches of snow in major crop production states such as North Dakota, Minnesota and South Dakota, forecaster Commodity Weather Group said.

Unharvested crops nearing maturity could be knocked over and damaged during the storm, the forecaster said. Farther south, rain will push farmers from their fields.

In its weekly crop update on Monday afternoon, the U.S. Agriculture Department said 15 per cent of the corn crop and 14 per cent of the soybean crop had been harvested as of Oct. 6, well behind the average pace.

Traders were waiting for the U.S. Department of Agriculture’s (USDA) latest crop forecasts, which will be released on Thursday.

“All eyes are on whether the USDA shaves its U.S. corn yield forecast again,” said Tobin Gorey, director of agricultural strategy at Commonwealth Bank of Australia.

— Mark Weinraub is a Reuters commodities correspondent in Chicago.

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