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U.S. grains: Wheat rises on weather concerns

CBOT soy, corn futures falter

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Chicago | Reuters — Chicago Board of Trade wheat futures rose 1.2 percent on Monday and hit their highest level since mid-February on concerns about dry conditions hampering crop development in the U.S. Plains, traders said.

Falling production in Australia and strong export data also lent strength to the wheat market, which closed in positive territory for the fourth time in five sessions.

Soybean futures closed slightly weaker as traders locked in profits from early gains, while corn faltered on technical selling. Corn also faced pressure from the discovery of a bird flu strain in a chicken breeder flock on a Tennessee farm.

“Talk of dryness for the southern Plains for the next 10 days might be affecting winter wheat,” Charlie Sernatinger, global head of grain futures at ED+F Man Capital said in a note to clients.

Concerns about early emergence of U.S. winter wheat leaving the crop vulnerable to a cold snap in the next few weeks also were bullish.

CBOT May soft red winter wheat futures settled up five cents at $4.58-1/2 a bushel (all figures US$). K.C. hard red winter wheat, which tracks the crop being grown in the U.S. Plains, hit its highest level since June 10.

Australia’s 2017-18 wheat crop is expected to fall 32 per cent, the country’s chief commodity forecaster said. Farmers in the world’s No. 4 exporter will harvest 23.98 million tonnes of wheat, the Australian Bureau of Agriculture, Resource Economics and Rural Sciences forecast.

The U.S. Department of Agriculture on Monday reported that weekly export inspections of wheat totaled 535,920 tonnes, near the high end of market forecasts.

Soybean export inspections were a bigger-than-expected 921,779 tonnes.

Wet weather in Brazil slowed transport of supplies from an expected record harvest in the world’s biggest exporter of the oilseed, keeping overseas buyers focused on the U.S. soy market.

CBOT May soybeans ended down 1/4 cent at $10.37-1/4 a bushel after trading in positive territory for much of the day.

Heavy rains and muddy roads have slowed shipment of recently harvested soybeans from Brazil but demand was expected to shift to South America as the weather improves.

“Transport delays are only a temporary disruption,” said Tobin Gorey, director of agricultural strategy at Commonwealth Bank of Australia. “The crops themselves are doing just fine and will find their way on to market sooner or later.”

CBOT May corn ended down 2-1/4 cents at $3.78-1/2 a bushel. Corn firmed early but failed to hold support above Friday’s high.

— Mark Weinraub is a Reuters correspondent covering grain markets from Chicago. Additional reporting for Reuters by Colin Packham in Sydney and Gus Trompiz in Paris.

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