Wheat extends gains, prices of soybean, corn face pressure from US weather

SINGAPORE/PARIS: Chicago wheat futures rose for a second session on Wednesday as investors covered short positions and looked for bargains, although plentiful world supplies capped gains.

Soybean and corn prices also gained ground, but both markets expected to remain under pressure as crop-friendly warm weather boosts planting across the US Midwest.

The Chicago Board of Trade most-active wheat contract was up 0.7 percent at $4.87-1/2 a bushel by 1100 GMT. In the previous session, it closed 2 percent higher after hitting a one-week low of $4.67-3/4 a bushel during the trade.

Soybeans added 0.5 percent to $10.39 a bushel and corn gained 0.4 percent at $3.91-1/2 a bushel.

"There is some short-covering and bargain-buying in the wheat market," said one India-based commodities analyst. "People are looking to determine the extent of damage to the US winter crop."

The US winter wheat crop has faced dry weather this year although ample global supplies are expected to keep a lid on prices.

The Black Sea region, a key supplier of wheat to top importing countries, is on track for another year of bumper production.

Corn and soybean prices are expected to be weighed down by forecasts for warmer weather that should allow farmers to pick up the pace of planting of spring crops after a slow start.

The US Department of Agriculture (USDA) said on Monday that 5 percent of the US corn crop was planted, as of Sunday, well behind the five-year average and lagging market expectations. Soybean planting was 2 percent complete.

"Weather conditions on the Corn Belt will be closely monitored in the coming days and could push the market in case of prolonged delay of spring sowings," French consultancy Agritel said in a note.

Concerns about slowing soybean exports continued to hang over the market amid a trade dispute between the United States and top buyer China.

The USDA said on Tuesday morning that private exporters reported the sale of 130,000 tonnes of soybeans to Argentina. There have been no announcements of deals with China in two weeks.

Commodity funds were net buyers of CBOT corn, wheat, soybean and soymeal contracts on Tuesday, traders said, but were net sellers of soyoil futures.