PARIS/SINGAPORE: Chicago wheat prices rose for a fourth straight session on Tuesday to trade close to seven-month high, as low US crop ratings and limited chances of rain in drought-hit parts of the US Plains region kept attention on the risk of yield losses.
Soybeans edged higher to hold close to Monday’s one-year peak as drought in Argentina continued to threaten harvest prospects in the major exporting country.
Corn also ticked higher.
The most-active wheat contract on the Chicago Board of Trade had climbed 0.6 percent to $4.75-3/4 a bushel by 1156 GMT.
It earlier rose to $4.76-3/4, matching Monday’s peak at the highest since Aug. 1, but failed to rally further.
The US Department of Agriculture said on Monday that 12 percent of the winter wheat crop in top growing state Kansas were in good-to-excellent condition, down from 14 percent at the end of January and below last year’s 43 percent.
The USDA rated 4 percent of the Oklahoma wheat crop as good-to-excellent, unchanged from the end of January but down from 43 percent a year earlier.
“One important reason for the poor plant assessments is the drought that has over 70 percent of Kansas and the whole of
Oklahoma in its grip,” Commerzbank analysts said in a note.
Monthly wheat ratings also declined in Montana, the Dakotas, Nebraska and Colorado, where, as in Kansas and Oklahoma, farmers grow hard red winter wheat, the largest US wheat class.
“Crop ratings for the winter wheat crop are significantly lower and weather forecasts for the next 15 days are not encouraging,” said an India-based agricultural commodities analyst.
Severe cold in Europe this week was also keeping attention on weather risks, although snow cover was expected to limit the impact of deep frosts in top wheat exporter Russia.
CBOT soybeans inched up 0.2 percent to $10.48-1/2 a bushel. They had closed down marginally on Monday in a slight pullback from a one-year high of $10.59-1/2 earlier in the day.
Corn also edged higher, adding 0.1 percent to $3.77-3/4 a bushel.
The soybean market remained focused on the scale of drought damage in Argentina, where officials fear crop losses could dampen economic growth in the major agricultural exporter.
The main Pampas grain belt is expected to receive about 15 millimetres of rain in the coming days, short of the 100 mm needed to reverse some of the damage, meteorologist German Heinzenknecht of the Applied Climatology Consultancy said.
However, the impact on global supply could be curbed by Brazil’s harvest which some forecasters expect to set a record volume.
Source: Brecorder.com
