Chicago | Reuters –– U.S. soybean and corn futures rose on Tuesday due to South American crop production woes that boosted prospects for U.S. supplies on the export market in the coming weeks, traders said.
Corn received further support from the uncertainty over unrest in Ukraine, hitting its highest on a continuous basis since mid-September.
Wheat hit its highest in three months as worries about Ukraine, a key exporter of both corn and wheat, spurred heavy short covering.
Traders said that U.S. soybeans remained the top choice for China, the largest buyer of the oilseed, due to production concerns and a slow harvest that delayed the shipment of supplies from Argentina and Brazil.
“They are going to continue to take our beans because we seem to be the most reliable supplier right now,” said Bill Gentry, a broker with Risk Management Commodities in Chicago.
There was talk that China was deferring some shipments from South American producers originally slotted for April until later in the year, Gentry said.
Soybean and Corn Advisor president Michael Cordonnier, an agronomist specializing in South America, cut his outlook for soybean production in Brazil to 87 million tonnes, three million lower than the U.S. Agriculture Department’s latest estimate. Cordonnier pegged Argentine soybean production at 53.5 million tonnes.
Private analytics firm Informa Economics lowered its estimate of the Brazilian soybean crop to 88.8 million tonnes and cut its Argentine soybean harvest forecast to 54 million tonnes, trade sources said.
Chicago Board of Trade May soybeans rose 13-3/4 cents to $14.23 a bushel (all figures US$). CBOT May corn was 13-3/4 cents higher at $4.84-1/4 a bushel and CBOT May wheat was 12 cents higher at $6.43-1/2 a bushel.
Corn’s 2.9 per cent gain, its biggest since Jan. 10, pushed the May contract to a settlement above its 200-day moving average for the first time.
The May wheat contract topped its 100-day moving average for the first time since Oct. 31 and closed above that key technical benchmark, a bullish sign.
President Vladimir Putin ordered troops in western Russia to return to base after military exercises and said the use of force by Russia in Ukraine was a choice of “last resort.”
Despite the apparent easing of tensions, the market remained on edge for supply disruptions from the region.
— Mark Weinraub is a Reuters correspondent covering grain markets from Chicago. Additional reporting for Reuters by Gus Trompiz in Paris and Manolo Serapio Jr. in Singapore.