U.S. grains: Wheat rises to one-month high on technicals

(Stephen Ausmus photo courtesy ARS/USDA)

Chicago | Reuters –– Chicago Board of Trade wheat prices climbed to a one-month high Tuesday on chart-based buying and fund short-covering as the market digested news that Russia might limit grain exports, traders said.

U.S. soybean futures retreated and corn closed lower after a volatile session.

At the CBOT, March wheat settled up 3-1/4 cents at $4.84-3/4 per bushel after reaching $4.88-1/2, its highest since Dec. 21 (all figures US$).

March soybeans finished down four cents at $8.76-1/2 per bushel and March corn ended down 1/2 cent at $3.69-1/4 a bushel.

Traders said wheat climbed on technical factors. Weekly data from the U.S. Commodity Futures Trading Commission last week showed commodity funds hold a historically large net short position in CBOT wheat, leaving the market open to bouts of short-covering.

Brokers were also still talking about an Interfax news agency report on Monday that Russia’s agriculture ministry was considering tougher grain export limits due to rising pork prices.

“Wheat is the only grain showing strength as there are thoughts Russia will impose an export tariff to help control domestic prices. While this may not actually take place, the simple thought it could is generating ideas of elevated demand for U.S. wheat in the global market,” said Karl Setzer, risk management team leader for MaxYield Cooperative in Iowa.

“Anything in a market that is starved for fresh news can and usually does get a reaction,” Setzer added.

Any curbs on Russian exports could boost the outlook for shipments from the U.S. and European Union.

“If Russia restricts grain exports, it will lead to higher demand for U.S. products which have been facing difficulty in finding buyers,” said Kaname Gokon from brokerage Okato Shoji in Tokyo.

Corn closed fractionally lower after failing to match Monday’s one-month high of $3.72-1/2. Soybeans declined but the March contract stayed inside the previous day’s trading range.

Global equity markets and crude oil prices rose, offering background support to grains and oilseeds.

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

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