Chicago Board of Trade (CBOT) wheat futures closed higher for a second consecutive session on Tuesday, gaining strength from the corn and soyabean markets as funds scrambled to cover their short positions, traders said. But wheat market gains were capped by news from a US Department of Agriculture (USDA) report that showed 64 percent of the US winter wheat crop was in good-to-excellent conditions, which bolstered expectations for a bumper harvest adding to an already ample supply base.
CBOT July soft red winter wheat settled up 11-1/2 cents at $4.48-1/2 per bushel. The contract hit a high of $4.50-3/4 in mid-day trading, the highest price since April 18.
K.C. July hard red winter wheat ended up 11-3/4 cents at $4.08-3/4 a bushel, while Minneapolis Grain Exchange July spring wheat futures ended the day up 5-1/4 cents at $5.23-1/4 a bushel.
US and European stocks also regained ground on Tuesday after President Donald Trump downplayed the US-China trade war as "a little squabble," a day after a spike in tensions between the world's two largest economies rattled financial markets.
All three CBOT grain markets rose after USDA reported late on Monday, after the markets closed, that the US planting pace for corn and soybeans this spring was slower than expected amid widespread weather delays.
For wheat this past week, the USDA said the US spring wheat crop was 45% planted, behind the five-year average of 67% but ahead of a Reuters analysts estimate of 35%.
The turnaround in prices also "came as traders recognized the significance of the delays, causing selling to dry up, short-covering and bottom-picking to begin and momentum flipped," INTL FCStone chief commodities economist Arlan Suderman said in a note to clients.
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