Wheat rises for third day on concerns over Russian exports

SINGAPORE/PARIS: Chicago wheat futures rose for a third consecutive session on Thursday, adding to a steep rise the day before on concerns that Russia may curb exports after a drought pushed prices higher.

The most-active wheat contract on the Chicago Board of Trade was up 0.6 percent at $5.45-1/2 a bushel by 0944 GMT, after touching a session high of $5.49-1/2 a bushel - the highest since Aug. 23. Wheat closed up 4.4 percent on Wednesday.

Wheat jumped on talk that Russia, the world's biggest wheat supplier, might curtail exports and impose a tax on overseas sales after a disappointing harvest this summer.

"The mere risk of a tax (on Russian wheat exports) would mean traders will instead turn to other sources for wheat," said Tobin Gorey, director of agricultural strategy at Commonwealth Bank of Australia.

"So mere fear of the export tax achieves some of the goals - diverting demand from Russia - without it being implemented. And given that Europe and Ukraine also have a lot less wheat this year, traders will have to look further afield. The US still has some excess inventory of winter wheat to sell."

Euronext benchmark December milling wheat jumped 2.5 percent at the open on Thursday before paring most of its gains. They traded at 205.00 euros a tonne by 0944 GMT, up 0.9 percent.

Russia's agriculture ministry will meet grain exporters on Sept. 3 to discuss the market situation.

Russian consultancy IKAR on Tuesday lowered its estimate of 2018 wheat harvest to 69.6 million tonnes from 70.8 million previously. The firm left its Russian wheat export estimate unchanged at 32.5 million tonnes.

Soybeans and corn rose, but gains were limited by expectations of all-time high output in the United States.

Soybeans were up 0.5 percent at $8.40 a bushel, having firmed 0.3 percent on Wednesday while corn added 0.5 percent to $3.58-1/4 a bushel, having gained 0.1 percent in the previous session.

The Pro Farmer advisory service last week projected 2018 US soybean production at a record 4.683 billion bushels, topping the US Department of Agriculture's forecast for 4.586 billion bushels.

It also projected US corn yield of 177.3 bushels per acre, below the USDA's forecast of 178.4 but still a record high, if realised.

Commodity funds were net buyers of CBOT wheat and soybean futures contracts on Wednesday, traders said.

Estimates of net fund activity in corn ranged widely from net buyers of 10,000 contracts to net sellers of 9,000 contracts.