Wheat eases after rally, losses curbed by strong demand

SINGAPORE/PARIS: Chicago wheat futures slid on Wednesday after climbing to a five-month high in the last session, although the decline was limited by expectations of strong demand for US supplies.

Corn and soybeans eased after strong gains in past sessions concerns about the size of upcoming harvests in the Midwest.

The most-active wheat contract on the Chicago Board of Trade (CBOT) was down 1% to $5.58 a bushel by 1000 GMT, having closed up 2.1% on Tuesday when prices jumped to the highest since April 1.

"Supply-demand fundamentals are bullish for global wheat prices," said one Singapore-based trader at an international trading company. "Black Sea farmers are not selling and this is tightening supplies."

Dryness in the US Midwest grain belt, along with the impact of a mid-August windstorm in Iowa, have led traders and analysts to scale back previous projections for massive autumn corn and soybean harvests.

Soybeans were down 0.6% to $9.49 a bushel, having firmed 0.1% on Tuesday, and corn fell 0.6% at $3.56 a bushel, having closed little changed in the previous session.

Soaring corn prices are stoking food security jitters in China, where food inflation has climbed to the highest in more than a decade.

Prices have risen as the country heads for its first real corn shortfall in years in the upcoming 2020/21 season starting in October and could face a deficit of up to 30 million tonnes, around 10% of its total crop, say analysts and traders.

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