SINGAPORE/PARIS: Chicago soybean futures rose on Tuesday after suffering deep losses last week, with the market underpinned by concerns over poor rainfall affecting Argentina's key crop areas.
Wheat jumped 1.3 percent on expectations of strong demand from India, where two years of lower output has depleted stockpiles.
"Grains and soybeans have opened higher as it is mainly short-covering after the Christmas holiday break," said Kaname Gokon at brokerage Okato Shoji in Tokyo.
"The drought in Argentina is becoming an issue. If there is crop damage, we could see some more gains."
The Chicago Board of Trade most-active soybean contract was 1.1 percent higher at $9.99-3/4 a bushel by 1133 GMT, having passed the $10 threshold earlier in the session.
Wheat added 1.1 percent to $3.98-1/2 a bushel and corn gained 0.8 percent to $3.48-1/2 a bushel.
Heavy rains that pelted parts of Argentina over the weekend did not reach the southeastern part of the bread-basket province of Buenos Aires, where dryness is threatening to dent soybean production, local farm weather experts said on Monday.
Argentina aims to increase farm production under President Mauricio Macri, who has implemented a slew of market-friendly reforms since taking office a year ago. But the weather has not cooperated with farmers in some key growing areas.
The global wheat market, which has faced pressure from plentiful supplies, is finding a floor with India - the world's second-largest consumer - expected to import larger volumes.
India's wheat stocks in April next year, when the new season begins, are likely to be at their lowest levels in more than a decade after two successive droughts drained the soil of moisture and cut output.
Lower stocks will force India to import about 6 million tonnes of wheat in the fiscal years ending March 2017 and March 2018 to curb local prices, which have leapt 40 percent since the current year began in April, traders and industry experts said.
Commodity funds were net sellers of Chicago Board of Trade soybean, soyoil, soymeal, corn and wheat futures contracts on Friday.
Comments
Comments are closed for this article.