US wheat futures rose about 3 percent on Wednesday as signs of fresh export demand triggered a short-covering rally in a market where commodity funds hold a large net short position, traders said. Corn futures were choppy, paring early declines as wheat advanced. But soyabeans fell, pressured by the expanding harvest of a likely record-large US crop.
At the Chicago Board of Trade as of 12:56 pm CDT (1756 GMT), December wheat was up 12-1/2 cents at $4.08 per bushel, December corn was up 1/4 cent at $3.48-1/2 a bushel and November soyabeans were down 3-3/4 cents at $9.59-3/4 a bushel. Wheat rose on news that Morocco's grain agency bought 260,000 tonnes of US wheat. The US Commodity Futures Trading Commission's latest commitments report showed that as of September 27, non-commercial traders held the fourth-largest net short position in records dating to 2006. That big net short left the wheat market vulnerable to short-covering rallies. CBOT wheat and K.C. hard red winter wheat gained against Minneapolis Grain Exchange spring wheat futures as traders exited long Minneapolis/short Chicago and K.C. wheat spreads.
MGEX spring wheat has been rising since late September on worries about tight supplies of top-quality milling wheat. But the MGEX December contract pared gains after reaching a three-month high at $5.33-1/2 a bushel, just above its 200-day moving average. The bounce in wheat helped underpin corn futures, which were nearly flat late in the session. But soyabean futures fell on expectations for record-large yields. Informa Economics, a private analytics firm, forecast US 2016 soyabean production at 4.3 billion bushels with a yield of 51.6 bushels per acre (bpa), trade sources said.
Earlier this week, commodity brokerage INTL FCStone raised its soyabean yield estimate to a record 52.5 bpa. Both firms' yield figures were above the US Department of Agriculture's last official forecast of 50.6 bpa, signalling a possible increase when the government updates its figures on October 12.