Prices extend gains before USDA report, Russia export talk boosts wheat

PARIS/SINGAPORE: Chicago grain and soybean futures rose for a second straight session on Thursday, recouping losses from the last week ahead of a widely followed U.S. government crop report.

Traders are awaiting the U.S. Department of Agriculture's (USDA) world supply and demand report at 1700 GMT to gauge the impact of dry weather on South American harvest prospects, and strong Chinese demand on exports.

Wheat prices got an additional boost from renewed signs Russia may curb exports, traders said.

Prime Minister Mikhail Mishustin said Russia, the world's largest wheat exporter, would prepare measures to stabilise domestic food prices, and sources told Reuters the government is considering a grain export quota and wheat export tax.

The most-active wheat contract on the Chicago Board Of Trade (CBOT) ended the overnight session up 2.3pc at $5.96-3/4 a bushel, after earlier touching a 10-day high at $5.98-1/2.

CBOT soybeans were up 1.0pc at $11.69-3/4 a bushel and corn added 0.7pc to $4.26-3/4 a bushel.

"The latest bearish elements, mainly the rains in South America and the production estimates in Australia, now seem to be integrated and the markets are once again turning to the demand dynamics on the international scene," consultancy Agritel said.

Chinese demand has underpinned grain markets in recent months, although there has been a lull in U.S. soybean sales in recent days.

Weekly U.S. export sales data confirmed brisk overseas demand for U.S. corn.

The market was watching to see if the USDA will increase again its outlook for Chinese maize imports, with traders sceptical of official Chinese estimates on Thursday.