CHICAGO: US wheat futures fell on Friday, their third straight day of declines, as a firm dollar further dampened the already poor prospects for US supplies on the export market, traders said.
Corn futures also weakened, weighed down by the drop in wheat, while soybeans firmed slightly. Strength in cash markets and technical buying lent support to the soy market.
The dollar reached its highest in over three months against a basket of currencies on Friday after upbeat data showed U.S gross domestic product increased at a 3 percent annual rate in the July-September period, stronger than analyst expectations.
US wheat faces stiff competition on the export market due to the massive global supply glut. A firm dollar makes US wheat relatively more expensive for overseas buyers.
“The strengthening dollar is going to do nothing to improve our already slow export profile,” said Brian Hoops, president of Midwest Market Solutions, a brokerage and commodity marketing advisory service.
At 10:55 a.m. CDT (1555 GMT), Chicago Board of Trade December soft red winter wheat futures were down 5-1/4 cents at $4.26-1/2 a bushel. CBOT December corn was 2-1/4 cents weaker at $3.48-1/4 a bushel.
CBOT November soybeans were 1-3/4 cents higher at $9.73 a bushel.
Some technical buying in soybeans was noted after the CBOT November contract briefly dipped below its 40-day moving average, a level it has not closed under since Sept. 13.
Strong world demand for soybeans also underpinned prices for the oilseed.
The International Grains Council lifted its forecast for 2017/18 world grain production on Thursday, mainly due to an increased estimate of the US corn crop.
But the inter-governmental body also estimated that wheat inventories would swell to a record level this season while corn and soybean stocks would ease, Commerzbank said.
“In other words, while the corn and soybean markets tighten, the wheat supply situation remains ample,” the bank’s analysts said in a note.
Traders will be watching the results of a wheat tender by Saudi Arabia this weekend to gauge the competitiveness of different export origins.
Source: Brecorder.com
