SINGAPORE: Chicago corn futures rose as much as 4pc on Wednesday to their highest since 2016, after a US government report showed planting across the Midwest was lagging way behind the average pace for the time of year.
Wheat rose to a 3-1/2 month high as short-covering by funds buoyed the market, while soybean prices climbed to a 1-month peak.
"The US Midwest remains too wet for planting in many locations," said Tobin Gorey, director of agricultural strategy at Commonwealth Bank of Australia.
"Weekend rain was perhaps somewhat heavier than forecasters were expecting. And forecasters also have wet conditions continuing for much of this week."
Private forecaster Commodity Weather group predicted that most of the Midwest would see only minimal breaks in rain during the next 10 days, providing limited opportunity for fields to dry out and farmers to make progress between the showers.
The most-active corn contract on the Chicago Board of Trade was trading up 3.4pc at $4.34-1/2 a bushel by 0607 GMT, after climbing to its highest since June 2016 at $4.37 a bushel.
Corn futures are up more than 17.5pc since mid-May, thanks in part to a major short-covering spree by large speculators who have bought the equivalent of over 1 billion bushels of corn futures during that period.
Wheat gained 3pc to $5.19-3/4 a bushel, having earlier hit $5.20-3/4, the strongest since mid-February. Soybeans added 3.7pc to $8.87-1/4 a bushel, having climbed to $8.88 a bushel earlier in the session, its highest since mid-April.
The US Department of Agriculture said 58pc of corn crop was planted as of May 26, well below the average pace of 90pc at this time of the year. The agency, after the market closed on Tuesday, said 29pc of the soybean crop was planted, below the average of 66pc.
Analysts had been expecting corn planting to be 63pc complete and soybean planting to be 31pc complete.
Technicals called for the bullish trend to continue in corn prices.
The most-active contract is expected to break a resistance range of $4.40-3/4 to $4.45-1/2 and rise more towards $5.18-3/4, according to Wang Tao, a Reuters market analyst for commodities technicals.
The contract is riding on a fierce wave C, which is capable of travelling to $4.45-1/2, its 100pc projection level.
Agricultural markets in China tracked gains in CBOT soybeans and corn futures with soybeans, soymeal and rapeseed rallying around 4pc.
The wet weather is also hurting the winter wheat crop which is due to be harvested in the months ahead.
The USDA said 61pc of the US winter wheat crop was in good-to-excellent, down from 66pc a week ago but above last year's 38pc.
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