SINGAPORE: Chicago wheat futures rose for a third consecutive session on Tuesday, with the market trading close to its highest since 2014, as top exporter Russia's decision to impose tax on shipments underpinned the prices.
Soybeans and corn futures lost more ground.
"Russia's higher tax on wheat, and it remaining in place beyond June, continues to reverberate through wheat markets," said Tobin Gorey, director of agricultural strategy at the Commonwealth bank of Australia.
The most-active wheat contract on the Chicago Board of Trade (CBOT) was up 0.9% at $6.81-1/4 a bushel, as of 0208 GMT. The market was trading not far from its May 2014 peak of $6.93 a bushel touched in the previous session.
Soybeans gave up 1.3% to $13.98 a bushel and corn lost 0.7% to $5.28 a bushel.
Russian wheat export prices rose sharply last week ahead of a new export tax imposed by one of the world's largest wheat exporters from mid-February, analysts said on Monday.
Russia plans to impose a higher export tax on wheat from March 1, its economy minister said on Friday, in another push to curb a rise in domestic food prices triggered by the COVID-19 crisis.
Ukraine's grain exports have fallen 18.6% to 27.57 million tonnes this season, which runs from July 2020 to June 2021, economy ministry data showed on Monday. Traders sold 12.75 million tonnes of wheat, 10.52 million tonnes of corn and 3.89 million tonnes of barley, the data showed.
The US Department of Agriculture's reduced forecasts for US corn and soybean supplies on Tuesday sparked a rally that pushed soybeans to a 6-1/2-year high and corn to a 7-1/2-year high.At the same time strong demand, led by China continues to drive prices higher.
China's grains imports soared to record highs in 2020, customs data showed on Monday, after tight domestic corn supplies pushed prices to multi-year peaks, driving demand for cheaper imports.
China, the world's top agricultural market, bought a record 11.3 million tonnes of imported corn last year, including 2.25 million tonnes in December alone, according to General Administration of Customs data.
The monthly US soybean crush rose to the second highest monthly level on record in December, capping the busiest year of processing ever for the industry, according to data released by the National Oilseed Processors Association on Friday.
Large speculators raised their net long position in CBOT corn futures in the week to Jan. 12, regulatory data released on Friday showed.
The Commodity Futures Trading Commission's weekly commitments of traders report also showed that noncommercial traders, a category that includes hedge funds, increased their net short position in CBOT wheat and cut their net long position in soybeans.