SYDNEY: U.S. wheat futures advanced more than 1 percent in early Asian trade on Monday, hitting fresh 5-1/2 month highs, on strong demand for U.S. wheat at a time when global supplies of quality wheat are shrinking.
Chicago Board of Trade (CBOT) wheat for March delivery rose 1.24 percent to $8.34-3/4 per bushel, the highest price since early August last year when Russia banned grain exports after a severe drought cut grain production.
Corn for March delivery rose 0.38 percent to $6.59-3/4, pulled up by a rising wheat price which makes the grain more competitive as a livestock feed.
Soybeans for March delivery rose 0.28 percent to $14.16-1/4 per bushel on tight supplies even after rain in Argentina eased concerns about crops being affected by drought.
More rain forecast for this week could further ease stress and improve crop conditions.
FUNDAMENTALS
The need for food security, especially in countries facing rising prices for essentials, will likely keep a fire burning under the wheat market this week.
Chicago wheat futures rose 6.5 percent last week for the biggest weekly gain since the week of Dec. 5 as importers, led by North African nations, clamored to buy the grain.
Sales of U.S. wheat to foreign buyers last week exceeded trade expectations, topping 1 million tonnes. The previous week, wheat sales were a mere 175,000 tonnes.
The U.S. winter wheat crop, currently in a state of dormancy, has not been getting enough water, especially in the southern part of the Plains region.
This week traders will be closely watching to see if China adds to its purchase of 150,000 tonnes of Australian feed wheat, made last week.
The feed wheat bought by China was cheaper than U.S. corn, and Australia has a large quantity of feed wheat to sell after excessive rains downgraded the quality of the crop.
MARKETS
The Dow Jones rose on Friday as General Electric Co's earnings put a positive tone on the economic recovery, snapping a two-day losing skid for the benchmark index. The Dow Jones industrial average rose 49.04 points, or 0.41 percent. For the week, the Dow rose 0.7 percent.
The euro hit a two-month high above $1.36 on Friday and its break of important technical levels suggested more gains to come now that anxiety about a euro zone debt crisis has started to wane.
Brent crude futures rose above $97 a barrel on Friday as confidence in a European recovery boosted the euro to a two-month peak against the dollar, while U.S. oil ended a choppy session lower, stalling just above $89.
?
Comments
Comments are closed.