Chicago | Reuters –– U.S. wheat futures jumped on Friday on concerns that rising tensions between Ukraine and Russia will disrupt wheat shipments from the two key exporters, while corn posted its biggest weekly gain in five months.
Worries about disruptions to Black Sea grain exports sparked a round of short-covering among wheat traders who had built up bearish positions due to large global supplies, traders said.
The gains helped lift corn, while new-crop soybeans dropped on expectations for a record harvest. The new-crop corn contract has advanced for four consecutive sessions this week for the first time since February on short-covering and technical buying.
“Corn is enjoying a renaissance this week,” said Sterling Smith, futures specialist at Citi in Chicago.
Chicago Board of Trade December wheat futures rose 10-3/4 cents to $5.63-1/2 a bushel (all figures US$). December corn futures gained 3-1/2 cents to $3.77 a bushel.
The gains will likely be short-lived because U.S. farmers are projected to harvest a record corn crop this autumn, traders said. Many analysts expect the U.S. Department of Agriculture to increase its official yield estimate in the coming months due to favourable crop weather.
“The slow summertime activity, combined with the USDA’s modest hike in yields, is giving the market a brief boost,” Smith said.
Next week, traders will analyze hundreds of field surveys conducted by participants on the annual Pro Farmer Midwest Crop Tour for updates on the crop’s condition.
USDA, in a monthly report on Tuesday, put the U.S. corn harvest at a record 14.032 billion bushels, below analysts’ consensus estimate of 14.253 billion, and the soybean crop at a record 3.82 billion bushels, near estimates.
New-crop November soybeans futures fell four cents to $10.52 a bushel. Front-month September soybeans gained 4-1/4 cents to $11.02-1/2 on concerns about tight old-crop supplies.
The National Oilseed Processors Association on Friday reported a surprise increase in the amount of soybeans crushed in July.
— Tom Polansek reports on ag commodity markets for Reuters from Chicago. Additional reporting for Reuters by Colin Packham in Sydney and Sarah McFarlane in London.