PARIS/SINGAPORE: Chicago wheat consolidated on Thursday following a 10-month peak a day earlier as traders assessed rain forecasts in Russia to see if crop conditions in the world’s top exporter may stabilise after drought and frost damage.
Corn and soybeans edged up, supported by doubts over South American production and what were seen as attractive prices compared with wheat.
Grain markets were also awaiting weekly US export sales data for a gauge of overseas demand. The most-active wheat contract on the Chicago Board of Trade (CBOT) was up 0.1% at $6.93-3/4 a bushel by 1130 GMT.
On Wednesday, the contract had climbed to its highest since last July at $7.16-3/4 before turning lower to close under the psychological $7 threshold.
Reduced forecasts for Russia’s wheat crop have fuelled a steep rally this month, while also drawing attention to adverse weather in other major producers like Ukraine, Australia and France.
The surge in wheat prices swelled their premium over corn, encouraging some profit-taking in wheat since Wednesday as traders anticipated some livestock feed demand shifting to corn.
The market is monitoring weather charts which are suggesting some rain relief in the far south of Russia in the coming two weeks, though other wheat belts were set to miss out.
“Overall, not much has changed, and the direction in grains will continue to depend on changes in weather forecasts,” commodity data platform CM Navigator said in a note.
CBOT corn added 0.5% to $4.63-1/2 a bushel, while soybeans edged up 0.3% to $12.50-1/4 a bushel. Drought in two key Brazilian corn-growing states is reducing the potential size of the country’s second corn crop, according to consultancy Agroconsult.
That could further cap South American corn supply after sharp cuts to forecasts in Argentina following insect and weather damage.
The soybean harvest in Brazil may also be curbed by flooding in the far south, though national production is set to remain high.
Faster-than-expected planting progress in the US is keeping a lid on corn and soybean prices, supporting expectations of ample global supply for both crops.
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