US corn futures ticked higher on Wednesday, rising for the sixth straight session, while soyabeans were little changed and still around a 5-1/2 week high as hot weather and lack of rains in Argentina continued to raise supply concerns. Wheat fell almost half a percent as investors booked profits in thin trade after the harvest gathered pace in Australia, raising hopes that heavy rain over past weeks may not have caused such serious damage as feared.
"Wheat is drifting down with not many buyers in the market and some slightly more positive views being taken that the Australian harvest may be bad but not a disaster," one analyst at a European bank said. "But a premium for the weather risk in Argentina is still supporting soyabean and corn." Chicago Board of Trade March wheat fell 0.4 percent to $7.61-1/2 a bushel by 1302 GMT and March corn gained 0.6 percent to $6.06-1/4 a bushel. Soyabeans for January were little changed, down 0.08 percent at $13.25-1/4 a bushel remaining around recent highs.
European benchmark wheat prices in Paris edged lower on Wednesday after hitting new highs on Tuesday. The Paris January contract was 0.50 euro or 0.2 percent lower at 244.25 euros a tonne after hitting a contract high of 245 euros just before close the previous day.
Dry weather in key corn and soyabean producer Argentina held market attention. Much-needed weekend rains in Argentina fell short in some areas and temperatures were expected to be near to above normal in the near term, stoking fears of reduced production.
Most of Argentina's corn crop will be pollinating in December, when hot and dry weather can drag down yields. Dry weather will also further delay soyabean sowing in some areas and may put recently seeded crops at risk. Hamburg-based oilseeds analysts Oil World said Argentina's 2011 soyabean crop could fall as low as 43 million to 48 million tonnes, down from 54.4 million tonnes in 2010, due to dry weather.
Argentine soya plant workers started an indefinite strike at the main grains port of Rosario which lifted soya product futures, and helped to support soyabeans. Wheat prices surged this year after a drought which decimated the Russian crop and global supplies look to be further tightened by rain which reduced the quality of Australian wheat.
But eastern Australia's wheat harvest gained momentum this week. Some analysts say Australian crop quality, although lower than normal, is better than expected. "The harvest progress did creep along in the eastern states but still a month to month-and-half behind schedule in most areas," said Luke Matthews, a commodity strategist at the Commonwealth Bank of Australia. "There were fears earlier on that it could be a complete catastrophe, its probably not at that level but its certainly a very serious situation."
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