Grain, soy prices edge up ahead of monthly USDA report

LONDON: Wheat prices edged higher on Thursday as the market remained underpinned by concerns about dry weather in U.S. hard red winter wheat areas.

Corn and soybean prices were also slightly higher as dealers awaited the release of the U.S. Department of Agriculture's (USDA) monthly supply-demand report, due for release at 1600 GMT.

The most-active wheat contract on the Chicago Board Of Trade was up 0.7 percent at $5.14 a bushel by 1027 GMT.

The U.S. hard red winter wheat crop in the U.S. Southern Plains remains in significantly worse condition than last year despite a marginal recent improvement and the weather in the next few days is unlikely to improve the outlook.

"Weather forecasters continue to expect a little rainfall in dry Hard Red Winter wheat regions. The likely rain remains unlikely to be enough to do anything useful to crops," said Commonwealth Bank of Australia analyst Tobin Gorey.

Dealers said the scope for any major rise in prices may, however, be capped with the USDA's monthly report expected to show global supplies remain ample.

Analysts on average estimate 2018/19 world wheat ending stocks at 269.18 million tonnes, down only slightly from a record-high 271 million at the end of 2017/18.

"U.S. spring planting progress has been bit slow and we have had issues with the Hard Red Winter wheat crop, but if you look globally, it is hard to see supplies getting significantly lower," said Phin Ziebell, agribusiness economist, National Australia Bank.

"It is pretty tough to see any sustained rally in such a situation."

September wheat on Paris-based Euronext rose 0.4 percent to 173.75 euros a tonne.

CBOT soybean prices also edged higher, with the most active contract up 0.4 percent at $10.19-1/2 a bushel.

On average, analysts expect the USDA on Thursday to lower its forecasts of domestic and global 2017/18 soybean ending stocks.

Analysts expect little change in the USDA's forecast for 2017/18 ending stocks for corn from its April figure near 2.18 billion bushels.

CBOT's most active corn contract was up 0.4 percent at $4.04-1/4 a bushel.