BEIJING/PARIS: Chicago corn, wheat and soybeans steadied on Wednesday, as selling fuelled by favourable supply prospects abated. Fresh gains for crude oil, supported by renewed hostilities in the Middle East and a lack of clear progress in talks between Tehran and Washington, helped stem the slide in grains, analysts said.
The most-active corn contract on the Chicago Board of Trade (CBOT) was up 0.3percent at USD4.41-3/4 a bushel by 1155 GMT, after reaching its lowest since February 24. CBOT wheat added 0.5percent to reach USD6.05-3/4 a bushel, having earlier touched its lowest since April 17.
CBOT soybeans rose 0.6percent to USD11.71-3/4 a bushel, after hitting its weakest level since April 20. It drew support from soyoil, which added 1.1percent to reach 79.21 cents per pound and was approaching a four-year high.
Improved weather globally plus the onset of Northern Hemisphere wheat harvesting have weighed on grain prices, turning attention away from the Iran war and drought damage to US wheat.
“Favourable rainfall across the US Corn Belt, Western Europe, the Black Sea region and even Australia is reassuring market participants,” Argus Media analysts said.
At the same time, renewed hostilities in the Middle East have clouded prospects for peace and the reopening of the Strait of Hormuz, they said.
Grain markets can track oil fluctuations, partly because some crops are used in biofuel, though grains have reacted less sharply to crude prices since last month as seasonal supply considerations have come to the fore.
Traders are also watching for any renewed demand after the price drop. Meanwhile, Tunisia has issued a tender to buy 75,000 metric tons of soft wheat, with bidding on Thursday, according to traders.
Grain markets are also monitoring for any Chinese purchases of US crops after Beijing agreed to expand agricultural trade at a mid-May summit with Washington.
Comments