U.S. grains: Wheat rallies, rebounds from three-month low

(Michael Thompson photo courtesy ARS/USDA)

Chicago | Reuters — Chicago Board of Trade wheat futures rose on Thursday, halting a six-session slide and rebounding from a three-month low after the U.S. Department of Agriculture reported larger-than-expected weekly export sales.

Corn and soybeans both closed lower.

At the CBOT, March wheat settled up 2-1/2 cents at $5.07-3/4 per bushel, paring gains late, but holding above psychological support at $5 (all figures US$).

March corn ended down 1-3/4 cents at $3.71-1/2 a bushel and March soybeans finished down two cents at $9.68-1/4 a bushel.

Wheat rallied after USDA reported U.S. export sales in the week ended Jan. 22 at 544,400 tonnes, above a range of trade expectations and the most in four months.

“With several days in a row of nearby Chicago wheat futures declining, something has to give. Good export sales prompted a technical rebound in this market,” said Terry Reilly, an analyst with Futures International in Chicago.

The biggest gains were in K.C. hard red winter wheat, which rebounded from contract lows. USDA said weekly export sales of U.S. hard red winter wheat totaled 192,400 tonnes, the largest share of the total.

Also bullish, Saudi Arabia’s state grain buyer said it was seeking 660,000 tonnes of hard wheat.

CBOT March corn fell on technical selling a day after closing below its 100-day moving average for the first time since early November.

USDA reported weekly U.S. corn sales at more than one million tonnes, in line with trade expectations. But the figure was down from 2.2 million tonnes a week earlier, a marketing-year high.

“This (is) giving trade the indication that corn demand has not increased as much as anticipated,” said Karl Setzer, a market analyst with MaxYield Cooperative in West Bend, Iowa.

Soybeans fell in choppy dealings, retreating from an early rally tied to larger-than-expected weekly U.S. export sales. Plunging soyoil prices weighed on the market as well as the prospects for large South American soy harvests.

Soyoil hit contract lows and the lead month dipped to 29.32 cents/lb., its lowest since December 2008, following an announcement this week by the U.S. Environmental Protection Agency that could clear the way for more soyoil-based biodiesel imports from Argentina.

— Julie Ingwersen is a Reuters correspondent covering grain markets from Chicago. Additional reporting for Reuters by Christine Stebbins in Chicago, Gus Trompiz in Paris and Naveen Thukral in Singapore.

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