US wheat futures jumped about 4 percent on Tuesday on technical buying coupled with concerns about rains delaying the Midwest harvest, traders said. Corn set a five-week high on declining US crop conditions while nearby soyabeans fell on softening cash values and stepped-up farmer selling.
At the Chicago Board of Trade, July wheat settled up 20-1/4 cents at $5.21-1/2 per bushel. July corn rose 7-1/2 cents at $3.67-1/2 a bushel, and July soyabeans fell 2 cents at $9.87-1/2 a bushel. CBOT wheat posted its biggest advance in a month after the US Department of Agriculture's weekly crop progress report confirmed the US winter wheat harvest is behind schedule. Weather forecasts for more unwanted showers in the southern Midwest soft wheat belt this week heightened concerns about crop quality.
"The US outlook doesn't look appealing for producers that want to get in and harvest their soft red winter wheat crop," said Terry Reilly with Futures International. Technical buying added momentum, with July wheat breaking through resistance at its 100-day moving average near $5.06 and its June 11 high of $5.15-1/2. Corn advanced on short-covering after the USDA rated 71 percent of the US crop as good to excellent, down from 73 percent a week earlier.
Ratings dropped sharply in states east of the Mississippi River. In Ohio, 61 percent of the corn was rated good to excellent, down 19 percentage points from the previous week. Good-to-excellent ratings fell by 15 points in Indiana. Soyabean ratings also fell, with 65 percent of the US crop rated good to excellent, down from 67 percent a week earlier. But the corn figures challenged assumptions that soyabeans were suffering more than corn from recent excessive rains.
As a result, traders exited long soyabean/short corn spreads. "In northern Indiana, clients have told me their corn actually looks worse than beans," said Mike Zuzolo of Global Commodity Analytics. CBOT July soyabeans fell after the contract was unable to break through its 200-day moving average near $9.96. Softer cash values added pressure, reflecting a pick-up in US farmer sales as cash values for old-crop soyabeans in some areas hovered near $10 a bushel.
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