CHICAGO: Chicago Board of Trade (CBOT) wheat futures rose nearly 2% on Monday, climbing for the third time in the last four sessions, underpinned by lower estimates for output in top exporter Russia.
Soybeans and corn ticked higher after losing ground last week, as the focus turned to dry weather this week in parts of the US Midwest.
SovEcon, one of Russia’s leading agriculture consultancies, said on Friday it had lowered its forecast for Russia’s grain exports in the 2019/20 marketing season, which started on July 1, by 7 million tonnes to 41.9 million tonnes.
The most-active wheat contract on the Chicago Board Of Trade
was up 10-1/4 cents, or 2.1%, at $5.06-1/2 a bushel by 10:08 a.m. CDT (1508 GMT). Corn was up 3-1/2 cents, or 0.8%, at $4.18 a bushel and soybeans were higher 3 cents, or 0.4%, at $8.86-1/4 a bushel.
Traders are waiting for the US Department of Agriculture to release updated acreage estimates for grains next month, after the June acreage report was considered to be an overestimate of how much was planted.
“We’re probably going to chop sideways until the August 12th numbers come out,” said Chris Manns with Traders Group.
The USDA is releasing its weekly crop progress report at 3:00 p.m. CDT (2000 GMT) Monday, and analysts are expecting the good-to-excellent ratings for corn, wheat, and soybeans to stay steady with last week’s report, at 57%, 54%, and 76%, respectively.
For corn, threats to production remain as forecasts indicated very hot and dry weather could return to the US Midwest in the weeks ahead, particularly in parts of producing states Illinois and Indiana, Commodity Weather Group said.
“We’re going to need some rain at some point,” said Manns. “Every time a tractor moves in the fields, a cloud of dust follows it.”
Agricultural markets are also eyeing progress in US-China trade talks. The year-long trade war between the world’s two largest economies has weighed on soybean trading.
US and Chinese trade negotiators shift to Shanghai this week for their first in-person talks since a G20 truce last month, as the two sides struggle to resolve deep differences on how to end the trade war.
China approved wheat imports from the Russian region of Kurgan and soybean imports from all parts of Russia, officials said, having all but halted US soy imports as the trade dispute deepened.
China was the top buyer of US soybeans until Beijing slapped a 25% tariff on shipments last year in response to US tariffs on a range of Chinese products.