CHICAGO: US wheat and soybean futures soared to multi-year highs on Wednesday as unfavorable weather threatened production in exporting countries.
Dryness has raised concerns among traders about the prospects for wheat planting in the US Plains and the Black Sea region and for soybean planting in Brazil.
Weather in the southern US Plains wheat belt is expected to remain mainly dry over the next six to 10 days, with above-average temperatures, according to broker Country Hedging.
"Dry planting conditions in the US, Russia and Ukraine, as well as dry growing conditions in Argentina, weakened yield prospects around the globe," said Jacqueline Holland, market analyst for Farm Futures.
The most-active Chicago Board of Trade (CBOT) wheat contract ended up 14-3/4 cents at $6.07-1/2 a bushel after rising to $6.11-1/2, its highest price since July 2015.
CBOT soybeans closed up 7 cents at $10.51 a bushel after rising to $10.59-3/4, their highest since April 2018. Deferred soy futures ended lower.
Corn settled 3-3/4 cents firmer at $3.88-3/4 a bushel and reached $3.92, its highest price since January.
Traders said delayed soybean plantings and harvests in Brazil could extend the export season for US soy on the global market. The United States and Brazil compete for sales to countries like China, the world's top soybean importer.
The US Department of Agriculture on Wednesday reported private sales of 132,000 tonnes of US soybeans to China and 120,000 tonnes to unknown destinations.
US agricultural exports to China hit $2.15 billion in August, the most ever for the month, led by strong soybean exports.
"The strong Chinese demand for US beans has been driving prices, but yesterday the trade began to talk about the concerns about the South American crop in earnest," said Tomm Pfitzenmaier, analyst for Summit Commodity Brokerage in Iowa.
Traders will review weekly US export sales data on Thursday and monthly supply/demand data on Friday.