Chicago | Reuters — U.S. corn rose 1.8 per cent on Friday for its biggest daily gain in about two weeks, rebounding from a nearly two-month low on support from short covering and increasing export demand.
Wheat and soybean futures were mixed in light volume, with bargain buying supporting some contracts even as worries of reduced export demand capped gains. Top importer China cancelled a large purchase of U.S. soybeans.
The higher prices for agriculture commodities were part of a broad rally with crude oil and stocks higher ahead of the Martin Luther King Jr. U.S. holiday on Monday.
“It’s a corrective rally. Crude is higher. The corn basis is firm and probably some export business being done near the 100-day moving average,” said independent trader Ken Smithmier.
The U.S. Department of Agriculture earlier said exporters sold 101,600 tonnes of U.S. corn to unknown destinations, in the fourth announcement of a sale of 100,000 tonnes or more in a week.
USDA also said China canceled purchases of 285,000 tonnes of U.S. soybeans.
Chicago Board of Trade March corn futures were up seven cents at $3.87 per bushel, gaining the most since Jan. 5 but still shedding about 3.5 per cent for the week (all figures US$). The contract tested its 100-day moving average on Wednesday when prices fell to the lowest since November, prompting a round of buying by importers such as Japan, South Korea and Taiwan.
CBOT March wheat was flat at $5.32-3/4, losing five per cent for the week — the largest weekly drop since September. Prices for the grain remained anchored by poor export demand, with U.S. wheat too expensive to compete for business in many top global markets including Egypt.
“The downward trend on U.S. wheat has become more and more pronounced. The correction has already taken it halfway towards the $5 floor due to fact that U.S. wheat is not competitive,” Alexis Poullain of French consultancy Agritel said.
Soybeans for March delivery edged 3/4 cent higher to $9.91-3/4 per bushel, hovering near their lowest since Oct. 27. The July and August contracts lost ground, pressured by expectations of record production in South America and the China export cancellation.
— Michael Hirtzer reports on agriculture and ag commodity markets for Reuters from Chicago. Additional reporting for Reuters by Gus Trompiz in Paris and Naveen Thukral in Singapore.