CHICAGO: US soybeans declined half a percent o n W ednesday as investors booked profits a day after prices hit a seven-month high, while wheat rose due to a lower dollar and to a cold snap that threatened the newly sown spring wheat crop and some of the more mature US winter wheat.
Corn posted tepid gains, lifted by the weaker dollar and a tentative rebound in equities from the previous session, when Wall Street posted a sharp decline as investors sold off risky assets.
On Tuesday, the risk-off trade pulled soybeans down, reversing an early rise, while corn fell more than 2 percent to a one-week low and wheat dropped on strong prospects for the 2012 US winter wheat crop.
"It's technical selling in beans, liquidation and I think some corn/bean spreading. Soybeans had been racing ahead of corn so I think there's a little adjustment today," said Jerry Gidel, analyst for Rice Dairy LLC.
CBOT May wheat was up 2-1/4 cents per bushel at $6.28, May corn was up 1-1/4 at $6.36 and May soybeans were down 4 at $14.22.
When grain markets closed near 1:15 p.m. CDT (1815 GMT) , the dollar index was down 0.13 percent, NYMEX May crude oil was up nearly $2.00 per barrel and the Dow Jones industrial average was up 108 points.
MGEX May spring wheat closed 4-1/2 cents per bushel higher at $8.38-1/4 per bushel.
Wheat futures turned firm on short-covering, bargain buying and talk of potential harm to some of the wheat crop due to the freezing weather. Top quality spring wheat also rose on demand for high protein wheat and to low US spring wheat plantings.
"There may be some wheat hurt by cold weather but I think a bigger reason for spring wheat gains is the low seedings this year in North Dakota. Farmers were planting corn instead of spring wheat," said Sterling Smith, analyst for Country Hedging.
The USDA in its annual March 30th plantings report said 2012 US spring wheat acreage would total only 11.976 million, below an average of analysts' estimate for 13.313 million and down from last year's sowings of 12.394 million. USDA also pegged this year's US corn acreage at 95.864 million, the biggest planted area in 75 years.
Smith said the low volume traded in the MGEX spring wheat futures market left it vulnerable to volatile price swings.
Freezing temperatures early on Wednesday covered most of the Midwest and some damage may have occurred to emerging corn and jointing wheat in portions of central Illinois, central and southeastern Indiana, southwestern Ohio and a few spots in Kentucky, Commodity Weather Group said. Temperatures fell as low as 28 degrees Fahrenheit (-2 Celsius).
Another bout of cold weather was expected early on Thursday followed by warmer temperatures and rainfall, then there was the potential for another freeze next week, said Jason Nicholls, meteorologist for AccuWeather.
"There could be another frost or freeze at mid-week but the weather models differ on that this morning," Nicholls said.
US spring wheat planting was 21 percent complete, up from just 3 percent a year ago and well above the five-year average of 5 percent, according to the US Department of Agriculture.
In North Dakota, the top spring wheat-producing state, seeding was 17 percent complete, up from 6 percent a week earlier. A year ago, spring wheat planting had not started in North Dakota.
"Ideal weather conditions allowed fieldwork and planting activities to continue ahead of average," the USDA's National Agricultural Statistics Service's North Dakota field office said in a report.
The state report showed that 3 percent of the spring wheat crop had emerged in North Dakota, the earliest emergence on record.