US wheat futures fell on Wednesday on fund-driven technical selling and a proposal by Russia's farm ministry to cut a wheat export tax, which tempered speculation about export restrictions. Corn coasted for the second straight day, while soyabean futures rose on dry weather concerns in South America and southern Africa.
At the Chicago Board of Trade, March wheat settled 8-1/4 cents lower at $4.76-1/2 per bushel, a day after hitting $4.88-1/2, its highest since December 21. March corn finished unchanged at $3.69-1/4 per bushel while March soyabeans settled up 6-1/2 cents at $8.83 a bushel, the contract's biggest daily rise in two weeks.
Wheat fell for the first time in five sessions in largely technical trade as the market awaited fresh fundamental news. "We are in a pattern of seeing short-covering rallies run out of steam," said Joe Davis, director with Futures International in Chicago. "Usually this time of year we have weather and acreage talk grab headlines, and we are not seeing much of that this year," Davis said.
Wheat rallied earlier this week on talk that Russia, a top exporter, could toughen grain export terms to help curb domestic food prices. But First Deputy Agriculture Minister Evgenii Gromyko said on Wednesday his ministry had proposed removing or reducing a wheat export tax, and imposing one on corn and barley. "If they reduce the (wheat) tax, that just makes more wheat in the world," said Jason Roose, analyst and vice president of US Commodities.
The introduction of a corn export tax by Russia could boost a corn market in which weather-related production losses in southern Africa are seen trimming large worldwide supplies. CBOT soyabeans rose, with the spot March contract settling above its 100-day moving average. The soya complex drew support from concern about dryness in crop areas in Argentina. "(O)ur forecast offers little relief for the driest 20 percent of the belt," the Commodity Weather Group said in a note to clients, adding, "Minor reductions in yield potential are expected, although a lack of heat will mitigate stress to some extent."
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