Chicago | Reuters — U.S. corn futures topped a three-month high on Thursday on improved export demand, while wheat futures traded near a 1-1/2 year high reached a session earlier.
Soybeans eased to a one-month low as traders awaited signs of Chinese purchases of U.S. crops in the wake of last week’s initial trade agreement between Washington and Beijing.
The U.S. Department of Agriculture has not confirmed agricultural sales to China since the countries signed the deal, in which Beijing pledged to increase imports of American farm products. But the agency said private exporters sold 141,000 tonnes of U.S. corn to unknown destinations for 2019/20 delivery and another 143,948 tonnes to Guatemala.
U.S. corn prices are low compared to other suppliers, which should attract buyers, analysts said. Importers from Korea and Egypt have been in the market in recent days, according to traders, despite concerns about the quality of U.S. supplies.
The deals with unknown destinations “will stir rumours of possible China sales following cash reports that China was inquiring at the end of last week,” said Arlan Suderman, chief commodities economist for U.S. broker INTL FCStone.
Most actively traded corn ended 1.2 per cent higher at $3.93-3/4 a bushel on the Chicago Board of Trade and reached its highest price since Oct. 18 (all figures US$). Technical buying helped drive gains as the nearby March contract topped the area around $3.92, traders said.
Most-active wheat edged up 0.3 per cent to $5.80-1/2 a bushel on the CBOT. On Wednesday, the contract reached its highest price since Aug. 2, 2018, at $5.92-1/2.
Most-active soybeans slipped 0.6 per cent to $9.09-1/2 and touched their lowest price since Dec. 13.
The United States is expected to face stiff competition for soybean export sales from Brazil, where farmers are set to bring in massive harvests. China is the world’s top soybean importer and turned to Brazil, instead of the United States, for supplies during the height of the trade war between Washington and Beijing.
“We sit waiting for China to knock on the door of the U.S. and the Brazilian harvest looms with large production ideas being realized,” CHS Hedging said in a note.
USDA is set to release weekly export sales data on Friday.
Brisk global demand continued to underpin CBOT wheat futures, analysts said. Traders also worried that transport disruptions in France, a drought-hit harvest in Australia and proposals to cap grain exports from Russia will tighten global supplies.
Investor wariness about a coronavirus outbreak in China kept markets subdued.
— Reporting for Reuters by Tom Polansek in Chicago; additional reporting by Gus Trompiz in Paris and Colin Packham in Sydney.