SINGAPORE: Chicago wheat futures gained more ground on Friday, with the market poised for a third straight weekly gain as dry weather across key exporting countries reduces yields.
Wheat climbs to one-week high as dryness hits crops
Corn and soybeans inched higher, but both markets were set to end the week in negative territory as investors adjusted positions before a US Department of Agriculture supply-demand report due later in the day.
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The most-active wheat contract on the Chicago Board of Trade (CBOT) rose 0.5% to $6.06-3/4 a bushel, as of 0017 GMT, corn gained 0.3% to $4.19-3/4 a bushel and soybeans climbed 0.3% to $10.17-3/4 a bushel.
For the week, wheat is up almost 3%. Corn is down 1.2%, heading for its first decline in three weeks, while soybeans have lost about 2%, falling for a second week in a row.
Harsh weather is reducing wheat production in major exporting countries, cutting inventories that have already been projected to hit nine-year lows while fuelling a sudden surge in prices.
Drought has slowed winter wheat sowing in Russia, while in Argentina the Rosario grains exchange on Wednesday trimmed its estimate for the 2024/25 wheat harvest due to insufficient rainfall.
Strategie Grains on Thursday kept its main EU wheat crop estimate unchanged at a 12-year low after rain-hit harvests in France and Germany, which it expects to push down EU exports to a six-year low.
Ukrainian officials said a Russian missile attack in the Odesa region that killed six people on Wednesday damaged a container ship, the latest vessel to be hit in recent days as Moscow intensifies strikes on Ukraine’s ports.
Argentine farmers have halted their corn planting in western parts of the country’s agricultural heartland due to dry soil after weeks of poor rainfall, the Buenos Aires grains exchange said on Thursday.
However, lower chances of climate phenomenon La Nina emerging this year should limit the risks of soybean crops in southern Brazil and Argentina facing a lack of rainfall in the 2024/25 season, consultancy StoneX said.
“The bumper US corn and soybean crops are up for revision again on Friday when the USDA issues its next round of monthly supply and demand data,” Karen Braun, a market analyst for Reuters, wrote in a column.
“Unlike in past Octobers, adjustments to US corn and soybean acres are not on the table this time around, meaning any production surprises would have to come from yield.”
Commodity funds were net sellers of CBOT soymeal, corn and soybean futures on Thursday and net buyers of CBOT wheat and soyoil futures, traders said.
Source: Brecorder
