US wheat futures edged higher on Thursday, after powering to 13-month highs a day earlier, with concerns that drought in Russia will slash grain exports still dominating sentiment. Corn and soybean prices rose up to 0.5 percent, with both seen benefiting from a jump in demand due to the poor European growing conditions.
Chicago Board of Trade wheat futures were at $6.16-1/4 per bushel in early Asian trade, up 0.1 percent from the end of US session. Prices on Wednesday hit $6.23-1/4, the highest for a front-month since June 2009, before easing to $6.15-/12. Wheat prices are on track to post their biggest monthly gain since 1973, supported by concerns that Russian grain exports may be pegged back next season due to drought. An Australian-based analyst said prices could remain under upward pressure because of the dry weather, particularly afflicting Russia's grain growing regions.
September Corn was trading at $3.77-1/2 a bushel, up 0.3 percent. Some traders pointed to a potential squeeze in supply of US corn as European buyers seek replacement feed grains for wheat. Soybean futures also held a firmer tone, rising 0.5 percent to $10.15-3/4, after breaking a key resistance level. The gains were also underpinned by concern that crops of rapeseed, a fellow oilseed, could be damaged from the drought conditions in Europe.
Russia's drought-stricken wheat areas will see little to no rain over the next week, adding to concerns about shrinking grain output, a US agricultural meteorologist said on Wednesday. US stocks fell on Wednesday after weak durable goods figures and a downbeat assessment of the economy from the Fed's Beige Book kept the benchmark S&P 500 trapped below its 200-day moving average.
The Dow Jones industrial average dropped 39.81 points, or 0.38 percent, to 10,497.88. Tokyo's Nikkei fell 1 percent on Thursday, with investors taking profits after the index hit a two-week closing high the previous day. The US dollar eased towards three-month lows against a basket of currencies on Thursday, as fresh evidence of a patchy recovery in the US led more investors to go short on the greenback.
Oil prices fell a second straight day on Wednesday on a surprise crude oil inventory build and weak economic data. The US Energy Information Administration inventory report showed crude stocks rose 7.31 million barrels last week as imports jumped. A Reuters analyst survey had forecast crude oil stocks would be down 1.6 million barrels. US crude for September delivery fell 51 cents, or 0.66 percent, to settle at $76.99 a barrel.