US spot corn futures hit their highest level in nearly a year on Thursday and Minneapolis spring wheat neared a two-year top on worries about hot and dry weather stressing crops in the northern Plains and Midwest, analysts said. Soyabean futures followed the higher trend.
As of 12:32 pm CDT (1732 GMT), Chicago Board of Trade July corn futures were up 2 cents at $3.86-3/4 per bushel after reaching $3.91-3/4, the highest spot price on a continuous chart since June 28, 2016. CBOT July wheat was up 6-3/4 cents at $4.51-1/2 per bushel after reaching $4.55-3/4, its highest in a month. MGEX July spring wheat was up 13 cents at $6.08-1/2 after reaching $6.17-3/4, a contract high and the highest spot price since July 2015.
CBOT July soyabeans were up 8 cents at $9.34-3/4 a bushel. Weather was the focus, with a hot weekend expected in the central United States early in the growing season for corn, soyabeans and spring wheat. Commodity funds held a large net short position in all three commodities as of May 30, leaving the markets vulnerable to a short-covering rally. "This is our first weather scare of the season, and the market was just too short going in. So we've got them on the run," said Tom Fritz, a partner with EFG Group in Chicago.
Trading volume in CBOT corn futures on Wednesday hit an all-time high of 1.09 million contracts, reflecting index funds rolling positions forward as well as active farmer selling as prices hit multi-month highs, analysts said. "I think we saw a tremendous amount of cash movement yesterday, old crop and new crop," Fritz said. Forecasts called for temperatures in the central Midwest and northern Plains to reach the mid-90s Fahrenheit (34-36 degrees Celsius) Sunday through Tuesday, and parts of South Dakota could reach 100 F (38 C), said Joel Widenor, an agricultural meteorologist with the Commodity Weather Group.
Rains should bring relief to parts of North Dakota, the top spring wheat state, by early next week, but may miss South Dakota. And a lack of rain over the next two weeks would leave about 25 percent of the Corn Belt at risk of stress, Widenor said. Soyabean prices drew support from hefty imports in China, the largest buyer of the oilseed. Imports rose in May by 25 percent from a year earlier to the highest on record as a backlog of previously purchased supplies arrived in the country.