U.S. grains: Soy, corn, wheat rally to close week

(Keith Weller photo courtesy ARS/USDA)

Chicago | Reuters –– Chicago Board of Trade soybeans rallied 2.4 per cent to their highest in more than a week on Friday, supported by signs of a pick-up in export demand for U.S. supplies, traders said.

U.S. wheat futures rose 2.2 per cent to their highest since Aug. 14. Wheat pulled corn higher on a round of technical buying and short covering as well as some concerns about dry weather limiting crop production in the Black Sea region and Australia.

Traders noted positioning in all three commodities ahead of the U.S. Agriculture Department’s quarterly stocks report on Sept. 30.

Soybeans, which have risen for three days in a row, posted their biggest weekly gain in seven weeks.

Importers from China, the world’s top soybean buyer, signed agreements to buy a total of 13.18 million tonnes of U.S. soybeans valued at about $5.3 billion at a signing ceremony in Des Moines, Iowa, on Thursday (all figures US$).

Additionally, the U.S. Agriculture Department said on Friday morning that exporters reported a flash sale of 260,000 tonnes of soybeans to China for delivery in the 2015-16 marketing year.

Currency fluctuations added further support as a rebound in the Brazilian real made soybean exports from that country relatively more expensive to overseas buyers and boosted demand for U.S. offerings. The real rallied after Brazil’s treasury announced a program of daily debt auctions.

CBOT November soybean futures ended up 21-1/4 cents at $8.89-1/4 a bushel. Soybeans rose 2.5 per cent this week.

CBOT December wheat was up 10-1/2 cents at $5.07-3/4 a bushel. Wheat rose 4.3 per cent this week, their biggest weekly gain in three months.

Dry weather is threatening the 2016 grain harvests in Ukraine and Russia, both major Black Sea wheat exporters which are currently sowing winter crops, analysts and forecasters say.

“With Ukrainian and Russian winter plantings put at only 25 per cent and 55 per cent complete respectively, the concerns (perceived or real) were deemed enough to trigger short covering by funds,” David Sheppard, managing director of UK merchant Gleadell said in a market note.

CBOT December corn rose 7-1/2 cents to $3.89 a bushel. Corn gained 3.1 per cent this week, its third straight week of gains.

Mark Weinraub is a Reuters correspondent covering grain markets from Chicago. Additional reporting for Reuters by Naveen Thukral in Singapore and Nigel Hunt in London.

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