US wheat and soyabean futures rose more than 2 percent early Tuesday on a short-covering bounce after a month-long price slide that was stirring fresh export interest, traders said. A broad-based advance in commodity markets led by crude oil also provided support. "After five days of declines in beans it's short covering that is leading beans higher," said Terry Reilly, a grains analyst with Futures International in Chicago.
Traders said Chicago grain markets were long overdue for a rebound. When Chicago Board of Trade March soyabeans broke through nearby resistance of $9.77-3/4 - a double-top notched in January - technical buying was triggered, they said. CBOT March soyabeans were up 22 cents, or 2.3 percent at $9.81-1/2 a bushel by 10:16 am CST. CBOT March wheat was 12-3/4 cents higher, or 2.6 percent at $5.05-1/2. CBOT March corn was up 8-1/2 cents, or 2.3 percent at $3.78-1/4, riding on the coattails of soyabeans and wheat, traders said.
Open interest in soyabeans and wheat rose sharply on Monday, up 9,100 contracts in soyabeans and nearly 11,000 in wheat - a sign both markets were oversold after falling to the lowest levels since the autumn.
With wheat trading near four-month lows, exporters have seen a pick-up in demand, traders noted. Egypt's GASC on Tuesday bought 300,000 tonnes of Romanian and French wheat for shipment during first-half March. Saudi Arabia purchased 690,000 tonnes of hard wheat via a tender on Monday. Iraq is seeking a minimum of 50,000 tonnes of wheat. "The weak euro is still providing strong support for EU exports. To take one example, a French ship is currently taking on board a consignment of (feed) wheat for Bangladesh - the largest quantity the country has ordered since 2000/01," Commerzbank said in a market note. Wheat futures in Paris were also higher with March up 1.5 percent, or 2.75 euros, at 185.75 euros a tonne.
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