Wheat jumps to near 3-week high on Black Sea supply woes, China weather

SINGAPORE: Chicago wheat rose more than 1% on Monday, climbing to its highest in almost three weeks, as concerns over Black Sea supplies and crop damage in China underpinned the market.

Corn jumped to a six-week high while soybeans gained for a fourth consecutive session with dryness in key growing U.S. Midwest supported prices.

FUNDAMENTALS

The most-active wheat contract on the Chicago Board of Trade (CBOT) added 1.3% to $6.26-3/4 a bushel, as of 0025 GMT, after climbing earlier in the session to its highest since May 17 at $6.28 a bushel.

Corn rose 0.5% to $6.12-1/4 a bushel, having risen to its highest since April 24 at $6.13 a bushel and soybeans gained 0.4% at $13.57-1/4 a bushel.

Kyiv said on Thursday the U.N.-brokered Black Sea grain export deal had been halted again as Russia had blocked the registration of ships to all Ukrainian ports.

However, Ukraine would be ready to continue exporting grain across the Black Sea as part of a “plan B” without Russian backing if Moscow pulls the plug on the current grain export deal and it collapses, Ukraine’s farm minister said on Friday.

In China, the largest wheat-growing province of Henan is expected to be hit by more rain in coming days, state forecasters said on Thursday, complicating efforts to harvest grain already damaged by wetter than normal weather in late May. China is the world’s biggest wheat consumer.

The condition of French soft wheat declined in the week ended May 29, data from farm office France AgriMer showed on Friday, suggesting a dry spell was starting to affect some crops. An estimated 91% of soft wheat was rated as being in “good-or-excellent” condition, down from 93% the previous week.

Forecasts of dry weather for newly planted corn and soybean crops in the U.S. Midwest supported prices.

Bullish April crushing data lent additional support to soybean futures. The U.S. Department of Agriculture on Thursday said U.S. processors crushed 187 million bushels of soybeans in April, topping a range of analyst estimates.

Large speculators trimmed their net short position in CBOT corn futures in the week ended May 30, regulatory data released on Friday showed.

The Commodity Futures Trading Commission’s weekly commitments of traders report also showed that non-commercial traders, a category that includes hedge funds, increased their net short position in CBOT wheat and increased their net short position in soybeans.

Global shares and U.S. Treasury yields rose on Friday following stronger-than-expected job growth data that raised investor expectations that the Federal Reserve could retain its interest rate hikes.