SINGAPORE: Chicago corn jumped more than 2% on Tuesday, with prices climbing to their highest in a week, while soybeans rose 1.8% after a US government report showed declining condition of both crops.
Wheat gained more ground after a Russian missile strike on the Ukrainian port of Odesa over the weekend raised doubts about implementation an agreement to open a corridor for Ukrainian grain exports.
“We reiterate that the recent ‘Black Sea Initiative’ is not an indication of a normalization of Ukrainian export flows-highlighted by Russian missile attacks on the port of Odesa the day after the signing ceremony,” analysts at J.P. Morgan said in a note.
The most-active corn contract on the Chicago Board of Trade (CBOT) was up 2.3% at $5.97-1/4 a bushel, as of 0356 GMT, after hitting its highest since July 19 at $5.99-1/2 a bushel.
Soybeans added 1.8% to $13.70-1/4 a bushel and wheat gained 1.9% at $7.84-1/4 a bushel.
CBOT corn to retest resistance at $5.86-1/4
The US Department of Agriculture’s weekly condition ratings for corn, soybeans and spring wheat on Monday fell more than most analysts expected after sweltering heat across the US Midwest and Plains.
The agency rated 61% of the US corn crop in good to excellent condition, down from 64% a week earlier, and soybean ratings fell to 59% good-to-excellent, from 61% previously.
Analysts surveyed by Reuters on average had expected the government’s ratings for each crop to decline by 1 percentage point.
Hot and dry weather during crucial corn pollination and soybeans pod development is likely to provide further bullish momentum to the markets.
The wheat market fell last week after Russia, Ukraine, the United Nations and Turkey signed a deal on Friday to reopen three Ukrainian Black Sea ports for grain exports.
The Russian missile strike on Odesa created scepticism. Moscow brushed aside concerns the deal could be derailed, saying it targeted only military infrastructure.
Ukraine denounced the attack as showing that Moscow cannot be trusted.
Ukraine said it was pressing ahead with efforts to restart exports and that the first grain shipment under the deal could take place this week.
Brazilian farmers have harvested 61.8% of their second corn crop in center-south fields, up roughly nine percentage points from last week, agribusiness consultancy AgRural said on Monday as rising output pressured growers to drop prices in the country.
Harvesting so far in the 2021/22 season totalled some 50 million tonnes, AgRural said in a report, noting that work is gaining pace in states such as Parana and Mato Grosso do Sul amid a recent improvement in grain humidity.
The European Union’s crop monitoring service MARS on Monday cut its yield forecasts for all summer crops, including maize, due to hot and dry weather in many parts of the bloc while making small reductions to its winter grain projection.
Crop prospects in the EU have taken on extra significance this year as Russia’s invasion of Ukraine has disrupted Black Sea exports.
Commodity funds were net buyers of CBOT corn, soybeans, soymeal and wheat futures contracts on Monday and net sellers of CBOT soyoil futures, traders said.
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