PARIS/SINGAPORE: Chicago wheat, corn and soybeans rose on Wednesday, underpinned by signs of a hardening conflict between Ukraine and Russia as well as hopes that tariff negotiations between Washington and grain importers like China and Vietnam will boost U.S. exports.
Favourable conditions for U.S. crops remained a curb on prices, which hit a six-month low for corn on Tuesday and a seven-week low for soybeans on Monday.
The most-active wheat contract on the Chicago Board of Trade (CBOT) was up 0.6% at $5.39 a bushel by 1137 GMT.
The wheat market has been torn this week between concern over Black Sea grain trade, as Ukraine has stepped up attacks on Russian targets, and improved conditions for U.S. crops as estimated by the U.S. Department of Agriculture’s weekly crop progress report on Monday.
“The renewed geopolitical tensions in the Black Sea continue to fuel market volatility,” Argus analysts said in a note, adding, “The stronger-than-expected increase in winter wheat and especially spring wheat crop ratings weighed on these products.”
Traders were also monitoring drought damage to the wheat crop in China, though it was unclear if this would prompt more imports given large Chinese stocks.
Wheat drops on improved US crop rating; corn hits six-month low
CBOT soybeans edged up 0.5% to $10.46 a bushel, while corn added 1.1% to $4.43-1/2 a bushel, putting the crops on course for a second daily rise as they recovered from this week’s lows.
On the trade front, U.S. President Donald Trump and Chinese counterpart Xi Jinping are set to speak this week, the White House said on Monday, boosting hopes about negotiations, days after Trump accused China of violating an agreement to roll back tariffs and trade restrictions.
Worries about demand for U.S. soybeans from the world’s biggest oilseed consumer have curbed soybean futures this year.
Vietnamese firms, meanwhile, have signed memorandums of understanding to buy $2 billion worth of American farm produce, including corn, wheat and soymeal as part of efforts to seal a new trade deal between the two countries.
Investors remain cautious about trade tensions, however, amid Chinese restrictions on critical mineral exports and Washington’s move to double tariffs on steel and aluminium imports.
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