US wheat rose more than 1 percent on Monday, gaining for a third straight session, while corn was up 0.9 percent as European leaders moved closer to a plan to resolve the region's debt issues at a weekend meeting. Corn and soyabeans were also underpinned by US farmers holding back stocks of freshly harvested crops in the hope of higher prices after a recent selloff.
"The dollar is under pressure and overall commodities are a bit firmer, it seems to be macro driven," said Brett Cooper, a senior manager of markets at FCStone Australia. "Internal basis levels are holding up well in the US on lack of farmer selling." Chicago Board of Trade December corn rose 0.9 percent to $6.54-3/4 a bushel by 0330 GMT and December wheat gained 1.3 percent to $6.40 a bushel. November soya was up 1.1 percent to $12.25-1/4 a bushel.
Asian stocks rose and the euro gave back some of the gains it made last week after euro zone leaders made some progress towards a strategy to tackle the region's debt crisis. At a summit on Sunday, European Union leaders neared agreement on bank recapitalisation and on how to use the European Financial Stability Facility to stave off bond market contagion.
The agricultural market fundamentals were also supportive for prices on Monday. Farmers are reluctant sellers of their freshly cut corn and soyabeans because prices are well off recent peaks and they have sufficient cash flow to meet expenses for now. Soyabeans shed 4.6 percent last week and have dropped in six out of the past seven weeks. Wheat and corn closed up 1.4 percent last week.
Corn and soyabean spot basis bids were steady to firm around the US Midwest on Friday as slow farmer sales underpinned the basis. US farmers have been harvesting corn and soya at a breakneck pace. Early last week the US Department of Agriculture said the corn harvest was 47 percent complete and soya was 69 percent complete.
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