US wheat rose 1 percent on Monday to its highest in more than 2 months as delays in spring wheat harvest and dry weather ahead of winter crop planting buoyed the market. Corn rose 0.8 percent, while soyabeans climbed to its highest in more than two weeks on expectations of lower yields in the US Midwest crop belt as a result of late plantings and stress from hot weather.
The grain markets will be closely watching the annual Pro Farmer tour of US corn and soyabean fields in the Midwest this week as chatter of poor corn yields due to weather damage is picking up. "There are worries over wheat production in the US and talk about lower corn yields which is supporting prices," said Ker Chung Yang, analyst at Phillip Futures in Singapore.
"August is an important month for soyabeans and people are looking at the crop tour after which we will have a better idea about yields." Chicago Board of Trade front-month September wheat rose more than 1 percent to $7.40 a bushel, the highest since mid-June. Actively-traded December wheat rose 1.08 percent to $7.69-1/2 a bushel. December corn gained 0.8 percent to $7.30-3/4 a bushel and November soya rose around half a percent to $13.74-1/4 a bushel. Soyabeans climbed to $13.79-3/4 earlier, its highest since August 3. Nearly 100 crop scouts will trek across thousands of miles of Midwest farmland this week in search of a single truth: has this year's harsh weather done even worse damage to the US corn crop than was evident a month ago?
The annual Pro Farmer Midwest Crop Tour of US corn and soyabean fields is most likely to find one of the most varied crops ever, after rain-delayed spring planting and excessive, crop-stressing heat this summer left an uneven mark. The wheat market has been supported by delays in the harvest of spring crop and a drought in the US Plains which is threatening plantings for 2012 winter crop that start in September.
"Uncertainty regarding US spring wheat production prospects are driving the price action," Commonwealth Bank of Australia said in a note. "Also, supporting wheat values is the continued US Great Plains drought which has the market worried about hard red winter wheat planting prospects." For corn and soyabean crops there are forecast of rains in the Midwest this week.
Rain will sweep through most of the US Midwest corn and soyabean growing region this week, providing much-needed moisture for the filling corn crop and pod-setting soyabeans. Large speculators raised their net long stake in CBOT corn to the highest in two months, data from the US Commodity Futures Trading Commission showed, as the US Agriculture Department slashed crop forecasts by more than expected in a report. The non-commercial traders also added to their net long position in CBOT soyabeans for the first time in three weeks following an unexpectedly large cut in soyabean yields that fuelled worries about shrinking stockpiles at a time of accelerating global demand for food.
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