Wheat holds at 1-month peak on less promising global harvest

PARIS/SYDNEY: Chicago wheat futures extended gains on Thursday to a new one-month peak as latest crop estimates in major exporting countries like Argentina, France and Russia raised question marks about global supply.

Corn and soybeans were also higher, recovering from losses earlier in the week as weather forecasts predicted more intense heat arriving in the US Midwest crop belt later this month.

Price moves were capped by caution ahead of Friday's monthly supply and demand outlook from the US Department of Agriculture.

Traders were also awaiting the USDA's weekly grain export sales figures at 1230 GMT.

The most-active wheat futures on the Chicago Board Of Trade were up 0.6% by 1200 GMT at $5.19-1/2 a bushel.

They earlier climbed to $5.25-3/4, their highest since June 5, adding to a 4% surge on Wednesday.

Spot September wheat on Euronext also rallied further, reaching its highest in almost six weeks at 189.00 ($214.33) a tonne.

Argentina's Rosario Grain Exchange on Wednesday lowered its 2020/21 harvest estimate to a range of 18-19 million tonnes from 21-22 million previously, warning dry weather could curb planting.

On Tuesday, France's farm ministry forecast that the country's soft wheat production would drop 21% this year after adverse weather, while private consultants ProAgro and IKAR reduced their forecasts for this year's harvest in Ukraine and Russia, respectively.

"The balance sheets of the eight largest exporting countries are tightening but demand remains unknown," consultancy Agritel said regarding wheat.

Like other sectors, the COVID-19 epidemic continued to hang over grain markets with the risk that renewed lockdown measures could curb demand for restaurant food or transport fuel like earlier this year.

CBOT soybean futures were up 0.7% at $9.03-1/2 a bushel, while corn added 1.4% to $3.59-1/4 a bushel.