US corn, soyabean and wheat futures rallied on Tuesday, supported by a steep decline in the dollar that made all three commodities more attractive to investors looking for a hedge against inflation, traders said. Wheat notched the biggest gain, with the front-month Chicago Board of Trade contract surging 3.8 percent as traders used the dollar drop as a prompt to unwind bearish bets they had made on the grain amid an abundance of global supplies. The plentiful stocks situation worldwide has chilled export demand for US offerings.
The jump in wheat lent support to corn prices, which had hit their lowest in more than seven months on Monday, while soyabeans benefited from a slowdown in the pace of planting around the US Midwest. CBOT July soft red winter wheat futures settled up 18-3/4 cents at $5.12-1/2 a bushel while CBOT July corn gained 6-3/4 cents to close at $3.59 a bushel.
Wheat futures received additional support from concerns about damage to crops being grown in the US Plains. Recent flooding in southern areas sparked fears of lower quality in hard red winter wheat while a cold snap threatened to cut yields of spring wheat in northern areas. K.C. hard red winter wheat futures rose 4.3 percent while MGEX spring wheat gained 4.2 percent. CBOT July soyabean futures settled up 14-3/4 cents at $9.40-3/4 a bushel. The US Agriculture Department on Monday afternoon said soyabean planting progress advanced just 10 percentage points to 71 percent complete in the week ended May 31, behind analysts' forecasts and just 1 percentage point ahead of the five-year average.