HAMBURG: Chicago wheat futures dipped slightly on Wednesday but still traded near a 2-month high as concerns over US spring wheat yields and expectations of delays in US winter crop planting supported the market.
Corn and soybeans were little changed. The market was pausing after recent rises with new impetus being sought, analysts said.
"The bull needs to be fed and I'm not seeing a lot of fresh factors in the market," said Jaime Nolan-Miralles, commodity risk manager at FCStone Europe. "Weather will drive the market near term, but right now there are no real changes to forecast. A lack of early follow-through buying will in my opinion create some profit taking today."
Chicago Board of Trade September wheat fell 0.14 percent to $7.23-3/4 a bushel by 1117 GMT, still not far from Tuesday's peak of $7.32-3/4, the highest since mid-June.
The September Chicago corn contract was also little changed, down a marginal 0.04 percent at $7.13-3/4 a bushel and November soybeans were down 0.19 percent at $13.46-3/4 a bushel.
European benchmark wheat in Paris were firm, with harvest problems in countries including Germany also supporting. Paris November wheat was up 0.75 euros or 0.3 percent at 199.75 euros.
"The concern about the US crop is supporting prices but we need more news to break further upwards today," one European trader said.
US wheat prices have been rising as concerns grow over harvest delays in US spring wheat territory with reports of low yields fuelling price gains.
A weekly report from the US Department of Agriculture issued after the close on Monday rated the US spring wheat crop at 66 percent good to excellent, unchanged from a week earlier but down from 82 percent a year ago. The harvest was 13 percent completed, compared to a five-year average of 39 percent.
The grain market also factored in news that US farmers were unable to plant 7 million acres due to cold and rainy spring in the corn belt and the northern US Plains.
US farmers reported 7 million acres (2.8 million hectares) of prevented plantings of corn, soy and spring wheat this year, the US Agriculture Department said.
"We have seen a big downward reduction from planted acres to harvested acres and the big reason for that has been this prevented plantings," Barclays Capital analyst Sudakshina Unnikrishnan said.
"We could see potentially further downward revisions in terms of some of the supply estimates so in that sense it's quite positive for prices."
The market is keeping a close watch on the US weather which is expected to turn warmer in the drought-hit Plains.
Crop weather in the US Midwest will remain conducive to plant development over the next week, while hot weather will return to the drought-stricken Plains, an agricultural meteorologist predicted on Tuesday.
In the soybean market, there were concerns about a La Nina weather pattern which could threaten South American crop next year.
Argentine and Brazilian soybean harvest in early 2012 could face damage from a looming La Nina weather pattern which may reduce rainfall during crop development periods, Hamburg-based oilseeds analysts Oil World said.
Copyright Reuters, 2011
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