CHICAGO: US wheat futures pulled back on Monday after approaching a six-week high on concerns about dry weather eating into harvests in some of the world’s main exporting countries.
Corn futures advanced for the sixth consecutive session to reach their highest prices in three weeks, while soybeans neared a two-week high before retreating.
Wheat slumped after rallying 3.8 percent last week on worries about dryness reducing production in countries ranging from France and Germany to Ukraine and Australia.
The European Union’s crop monitoring service, MARS, delivered the latest blow to global supplies by pegging the EU’s soft wheat yield at 5.82 tonnes per hectare, down from an estimate for 6.04 tonnes last month. That is 4.9 percent below 2017.
In Russia, the world’s top wheat exporter, yields are around a three-year low, according to agriculture consultancy SovEcon.
Such losses could increase demand for U.S. wheat on the global market, traders said.
“The U.S. is having good growing conditions and everybody else is suffering,” said Don Roose, president of Iowa-based broker U.S. Commodities.
On Tuesday, traders will look for the results of a tender for wheat from Egypt, the world’s top buyer.
The most-active Chicago Board of Trade wheat contract slipped 0.4 percent to $5.13-3/4 a bushel. It earlier climbed to $5.22-1/2, the highest since June 13. Deferred-month contracts still ended firmer.
CBOT corn rose 0.6 percent to $3.71-1/4 a bushel. That was near its session peak of $3.72-1/4, the highest since July 2.
Soybeans ended 0.2 percent lower at $8.62-3/4 a bushel after rising to $8.70, the highest price since July 10. The loss snapped a five-session rally, after soybeans touched a 10-year low on July 16 on concerns about the U.S.-China trade row.
Private exporters canceled the sale of 165,000 tonnes of U.S. soybeans to China for delivery during the 2018/19 marketing year, the U.S. Department of Agriculture said on Monday.
Such cancellations were expected due to the dispute, according to traders.
The USDA, in a separate report issued after trading ended, kept its good-to-excellent condition rating steady for corn and increased it by one percentage point for soybeans.
This could pressure prices overnight as analysts were expecting conditions to decline, said Rich Nelson, chief strategist for broker Allendale in Illinois. Still, concerns about unfavorable weather, including excessive rains in parts of Nebraska, should underpin the soy market, he said.
“There is some discussion that, certainly on the soybean side, producers are reporting slightly deteriorating conditions,” Nelson said.