US wheat futures rise

Chicago wheat futures rose more than 1 percent on Monday, taking the monthly gains to around 18 percent as weather concerns in top exporters United States and Australia continued to underpin the market. Corn futures were up for a fourth straight session with support from estimates for lower US planting in 2011, while soyabeans were little changed.
"There is some follow-through buying in the corn market after (analytical firm) Informa pulled their acres estimate...it is really setting the stage for what we are looking over the next 12 months and that is significant focus on fight for acres," said Luke Matthews, a commodity strategist at the Commonwealth Bank of Australia.
"Wheat more broadly remains supported by crop fears for 2011 season." Chicago Board of Trade March wheat rose 1.45 percent to $7.64 a bushel by 1333 GMT and corn for March delivery gained 0.84 percent to $6.00? a bushel. Soyabeans for January rose 0.83 percent to $13.09? a bushel.
Commerzbank said in a research report that weather reports from Australia were contradictory. "While there is a chance that the wet fields could dry, there is also the outlook of a wetter-than-average summer because of the la-ni?a weather phenomenon," the report said.
CBOT front-month wheat has risen nearly 18 percent so far in December, the biggest monthly gains since July when the grain market jumped more than 40 percent as a severe drought ravaged crops across the Black Sea region. CBOT wheat is on track to post its first annual gain in three years after dropping 42 percent in the past two years, helped by a drought which decimated the Russian crop and halted exports and rains which reduced the quality of Australian wheat.
Corn and soyabean futures are closing in on their second straight year of gains. Still, Australian farmers are bracing for dry weather which could give them a window to harvest the remaining crop. "Dry weather is expected for most of this week, along with warmer temperatures," said Joel Burgio, a senior agricultural meteorologist with Telvent DTN. "This will help improve conditions for mature wheat and the wheat harvest."
The corn market was supported by estimates of lower acreage in 2011. Informa Economics lowered its forecast of US corn plantings for 2011 and added acres to its soyabean forecast, citing rising projected returns for new-crop soyabeans. The firm estimated that US farmers would plant 90.755 million acres of corn in 2011, down from its November figure of 93.1 million.
The market is also focused on dry weather in Argentina as the corn crop pollinates, a critical period when weather can boost or crimp yields. Argentina is the world's second largest corn exporter after the United States. Large speculators raised their net long position in Chicago Board of Trade corn futures and options for a second consecutive week as supply worries and a sinking dollar lifted prices. The non-commercial trader net long holdings in corn rose to the highest point in five weeks as of the close on December 14, according to Commodity Futures Trading Commission data released on Friday.
In France, Europe's largest wheat exporter, wheat prices echoed gains in Chicago, with a weaker euro currency boosting sales prospects for European wheat on the world market. "A falling euro and a rise in Chicago give enough reasons for European wheat to climb but we'll see if this rise in Chicago will last in the afternoon," a trader said in France.