Chicago Board of Trade wheat futures climbed nearly 3 percent on Thursday, buoyed by a softer dollar and hopes for US sales of the grain to top buyer Egypt, traders said. Soyabeans rose, led by strength in soyaoil and Malaysian palm oil, while corn ended firm after a choppy session. At the CBOT, March wheat settled up 14-3/4 cents, or 2.9 percent, at $5.25-3/4 per bushel. March soyabeans rose 9-1/4 cents to $9.81-3/4, and March corn ended up 1-3/4 cents at $3.85-1/4.
Egypt's state grain buyer could purchase US wheat to make use of a $100 million credit line made available to it by the United States. "Part of the conditions of using that grant is to have a tender for US wheat to find the best price," Egyptian Supplies Minister Khaled Hanafi said. "The first slot that will be available for us to use is $100 million." Technical buying lent support. CBOT wheat was due for a bounce after falling nearly 15 percent during January, its biggest monthly decline in three years, amid ample world supplies.
"We have been oversold for quite some time and are seeing some short-covering coming into the market," said analyst Shawn McCambridge of Jefferies Bache in Chicago. Also supportive was a setback in the dollar, coupled with strength in crude oil and equity markets. Similar trends on Tuesday triggered a broad commodities rally. Soyabeans rose as surging Malaysian palm oil futures lifted global vegetable oils markets, including CBOT soyaoil.
Malaysian palm jumped more than 5 percent after plans by Indonesia's government to ramp up biodiesel subsidies passed a legislative hurdle. Higher subsidies could boost the use of palm oil for blending into biodiesel, demand for which has dwindled after crude oil prices crashed 60 percent between June and late January. Analysts said the outlook for a record Brazilian soyabean harvest remained a drag on soya prices. "Weather forecasters continue to expect timely rainfall in most Brazilian crop areas," Tobin Gorey, director of agricultural strategy for Commonwealth Bank of Australia, said in a note to clients. US soyabean export sales in the week ended January 29 came in at the high end of market estimates but were the second-lowest since October, indicating a seasonal slowdown.