CANBERRA: Chicago wheat futures took a breather in early trading on Thursday, after touching 3-1/2-month highs as drought in top producer Russia and a drone attack on a Ukrainian river port triggered supply concerns.
Corn futures held close to a three-month peak, supported by higher wheat prices and strength in the oil market after an Iranian missile attack on Israel. Higher oil prices can boost demand for biofuel made from crops and Middle East instability tends to lift wheat, traders say.
Soybeans edged lower as weather forecasts predicted rain in top producer Brazil, where dry conditions have slowed planting. The most-active wheat contract on the Chicago Board of Trade was down 0.3% at $6.13-1/2 a bushel at 0205 GMT after touching $6.17, the highest since June 14, on Wednesday. Prices are up around 6% so far this week.
CBOT corn was unchanged at $4.32-1/2 a bushel, having hit $4.34-1/4, its highest since June 28, in the previous session. Soybeans slipped 0.4% to $10.51-1/2 a bushel. All three contracts fell to four-year lows in recent months but have recovered some ground as central banks cut interest rates, the US dollar weakened and adverse weather threatened supply.
The Black Sea region has had 20% of its average rainfall and hot temperatures in the second half of summer and further dry weather could severely reduce winter sowing rates and next year’s production potential, said Vitor Pistoia, a Rabobank analyst in Sydney.
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