SINGAPORE: Chicago wheat futures gained more ground on Thursday, as the market continued to recover from last session’s lowest in more than two years on bargain buying and concerns over rains damaging China’s wheat crop.
Soybeans and corn prices rose with dryness forecast for the newly planted crops in the US Midwest. “China’s wheat-growing areas are getting excessive rains, which is not good for the crop which is ready for harvest,” said one Singapore-based grains trader.
“Depending on the damage, this is likely to support prices.”
The most-active wheat contract on the Chicago Board of Trade (CBOT) added 1.1% to $6.00-3/4 a bushel, as of 0315 GMT, after dropping to its lowest since December 2020 on Wednesday.
Soybeans added 1% to $13.12-1/2 a bushel and corn gained 0.7% at $5.98 a bushel. Wheat prices are recovering after suffering deep losses which were driven by ample global supplies and a lack of demand for US cargoes.
However, excessive rains have damaged the wheat crop in China, the world’s biggest consumer, which has already been buying record volumes from the international market since the beginning of the year.
China’s largest wheat-growing province of Henan is expected to be hit by more rain in the coming days , state weather forecasters said on Thursday, complicating efforts to harvest grain damaged by abnormally heavy precipitation in late May.
In the Black Sea region, the UN has proposed that Kyiv, Moscow and Ankara start preparatory work for the transit of Russian ammonia through Ukraine as it tries to salvage a deal allowing safe Black Sea grain exports, a source close to the talks said on Wednesday.
Concerns over dry weather are emerging in the US Midwest for corn and soybeans.
Wheat drops to 2-1/2-year low on improved US winter crop, weak exports
The US Department of Agriculture on Tuesday rated 69% of the US corn crop in good-to-excellent condition, down from 73% a year ago and below an average of analyst estimates for 71%.
Commodity funds were net sellers of CBOT soybean, corn and wheat futures contracts on Wednesday, and net even in soymeal and soyoil futures, traders said.
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