SINGAPORE: Chicago corn rose 1.3 percent on Thursday and wheat gained 0.9 percent as the markets took a breather after sliding to three-month lows in the last session, but improved supply prospects on crop-friendly US weather may keep a lid on prices.
Soybeans, which have been buoyed in recent weeks by tightening world supplies, rose around half a percent after sliding 1.3 percent on Wednesday, the biggest one-day loss in almost a month.
Analysts cautioned that gains may not be sustained as worries about the euro zone debt crisis and higher supply prospects may pressure the market.
"Influence from the outside markets cannot be underestimated as it continues to be jittery around the prospects out of Europe," said Luke Mathews, commodities strategist at Commonwealth Bank of Australia.
"There are favourable crop conditions in the US, only time will tell if this bounce we are seeing so far will last or not."
Chicago Board of Trade May corn added 1.3 percent to $6.09-3/4 a bushel by 0246 GMT and May wheat gained 0.9 percent to $6.16-1/2 bushel. Both the markets fell to their lowest since January on Wednesday on a continuation chart.
May soybeans rose 0.5 percent to $14.15 a bushel.
The US Agriculture Department on Tuesday confirmed that corn plantings were progressing at nearly a record rate while conditions of the US winter wheat crop also jumped.
"US winter wheat crop is rated extremely favourably," said Mathews. "In addition, we are seeing a very rapid pace of corn and spring wheat plantings."
Old-crop corn supplies are expected to shrink to the lowest in 16 years by the end of the summer, but farmers are forecast to plant the largest corn area since 1944, which will help replenish grain stockpiles.
Rains were forecast for Wednesday through Saturday in the US Midwest and will slow corn seedings, though plantings were already well ahead of the average pace.
The grain and oilseed markets have also been weighed down by Europe's debt crisis.
Asian shares moved in a narrow range on Thursday after the previous day's rally as investors grew cautious ahead of a key Spanish bond sale that would test the market's risk appetite as concerns mounted over the euro zone's debt crisis.
Doubts over Europe's ability to stick to harsh measures to slash high public debts began to grow when Spain abruptly relaxed its deficit targets earlier this month, and Italy said on Wednesday its priority was now reviving economic growth, delaying by a year its budget balancing goal.
Commodity funds sold an estimated net 20,000 CBOT corn futures contracts on Wednesday, trade sources said. They sold 3,000 wheat contracts and sold 6,000 soybean contracts.
Comments
Comments are closed.