Wheat surges two percent

US wheat rallied 2 percent on Thursday, posting its biggest daily gain so far this month, and corn rose as well after a cold snap threatened to harm US crops and macro-econoomic markets found fresh legs Corn advanced for the second day in a row as freezing temperatures harmed some of the early emerging corn crop and rain, which is forecast through the weekend, threatened to delay corn plantings.
Soya rose 1 percent on big demand for US supplies including additional business with China, and on declining crop prospects in South America. Brisk exports buoyed the corn market. US corn export sales topped trade forecasts for a second straight week last week as worries about tightening supplies prompted regular importers to book purchases more aggressively, traders said after a government report on Thursday.
"When you have years of tight stocks (such as this year) you typically see forward coverage, and that's what we're seeing in corn," said Terry Reilly, analyst with Citigroup. Soyabeans posted their biggest daily gain of the month on brisk export demand including a fresh US sale to China, the world's biggest soya buyer, and on another forecast decline in South American soya output this season due to drought.
Argentina's Buenos Aires Grains Exchange on Thursday trimmed another million tonnes from its forecast for Argentine soya output, putting its outlook at 44.0 million tonnes because of dry weather. That is in line with the Argentine government's forecast of 44.0 million tonnes and below the US government's latest outlook for 45.0 million. Argentina is the world's third largest soya exporter following the United States and Brazil and the largest exporter of soyameal and soyaoil.
Brazil's soya crop also has been reduced by drought and there is some concern American farmers may not plant enough soya this summer to provide adequate supplies to global markets. Grains and oilseeds got an added boost from a weak dollar and risk on upswings in equities, precious metals and crude oil. US stocks rose as lower yields on some euro-zone debt eased concerns and rumours about China's strong GDP increased investors' appetite for risk. CBOT May wheat was up 11-1/4 cents per bushel at $6.39-1/4 per bushel, May corn was up 1-1/2 cents at $6.37-1/2 and soyabeans for May delivery were up 19 cents at $14.41 a bushel.