SINGAPORE: Chicago wheat futures rose for the first time in three sessions on Tuesday, as the market recovered from its lowest in 17 months on support from dryness which is curbing US yield potential. Soybeans were largely unchanged, with prices underpinned by a drought reducing production in Argentina.
The most-active wheat contract on the Chicago Board of Trade (CBOT) rose 0.4% to $6.97-3/4 a bushel, as of 0330 GMT, after sliding to its weakest since September 2021 on Monday. Soybeans were flat at $15.29 a bushel and corn rose 0.2% to $6.38 a bushel.
The US Department of Agriculture’s (USDA) National Agricultural Statistics Service in a weekly crop report on Monday rated 17% of the winter wheat in top producer Kansas in good to excellent condition, down from 19% a week earlier.
Gains in wheat prices were limited by expectations that a grain corridor deal in the Black Sea will be extended.
Russian wheat prices declined last week, and Turkey’s foreign minister said Ankara is working hard to extend the safe shipping agreement that enables Ukraine to export grain, which expires in mid-March.
The Australian Bureau of Agricultural and Resource Economics raised its estimate of its 2022/23 wheat harvest to a record 39.2 million tonnes, from 36.6 million tonnes previously.
Australia is expected to report record-breaking agricultural exports in the current financial year, the government said on Tuesday, after years of high rainfall boosted yields.
Wheat down for second session on optimism over Black Sea grain deal
In the soybean market, the sale of Brazilian crop has reached 35.4% of the estimated production in the 2022/2023 cycle, according to agribusiness consultancy Safras & Mercado on Monday, lagging last year’s level and the historical average.
Brazilian farmers had sold 48.5% of their crop at this time last year, while the five-year average for farmer selling in the period is 51.7%, Safras said, citing data collected up to last Friday.
The USDA confirmed private sales of 110,000 tonnes of US corn to Japan and another 182,400 tonnes to unknown destinations, but the volumes fell short of what some traders had expected, given widespread chatter last week of China seeking corn.
The agency reported export inspections of US corn in the latest week at nearly 900,000 tonnes, the biggest weekly tally since July, but weekly inspections of US soybeans and wheat fell below trade expectations.
Traders were positioning ahead of the USDA’s monthly supply/demand report on Wednesday, in which analysts expect the government to cut its forecasts of Argentina’s soybean and corn harvests. Commodity funds were net buyers of CBOT soybean and soymeal futures contracts on Monday, traders said.
They were net sellers of CBOT wheat, corn and soyoil contracts.
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