CANBERRA: A rally in Chicago wheat futures hit the buffers on Thursday, with prices falling from Wednesday’s one-month high as the US dollar halted its decline and a Russian consultancy raised its production forecast for the country.
Corn and soybean futures also fell. The most active wheat contract on the Chicago Board of Trade (CBOT) was down 0.6% at $5.46 a bushel at 0720 GMT, with CBOT soybeans falling 0.4% to $10.58-1/4 a bushel and corn easing 0.5% to $4.58-3/4 a bushel.
Wheat slumped to a five-year low of $5.06-1/4 on May 13, hurt by ample supply and lacklustre demand from importers. But a weakening dollar, concerns over adverse weather in Russia and China and an unexpected decline in US wheat ratings triggered a wave of short-covering that drove prices as high as $5.56-1/4 on Wednesday. A weaker US dollar makes US farm goods more attractive to overseas buyers. The greenback rose slightly on Thursday.
“People are starting to notice just enough things to say hold on, there’s been no risk premium built into these wheat prices,” said an analyst at a grains trader in Australia.
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