Chicago | Reuters — U.S. corn futures jumped more than one per cent on Thursday to their highest level in 2-1/2 weeks as concerns about delayed planting in the western U.S. Midwest sparked buying and fund short-covering.
Soybeans followed corn higher, although gains were restrained by lower-than-expected weekly export sales data and concerns about trade with top importer China.
Wheat ended firmer as late-session short-covering and spillover support from corn reversed earlier declines.
The market’s focus remained on record flooding in the western Corn Belt, including Iowa and Nebraska, two of the top three corn-producing states. Early estimates of lost crops and livestock are approaching $1 billion in Nebraska alone (all figures US$).
Heavy snows and the expected flooding in the U.S. northern Plains spring wheat belt, particularly in top producer North Dakota, have also raised the risk of delays in planting the 2019 crop. Seeding normally begins in April.
“The weather outlook is not great. While it is too early to say that we’re going to miss out on a whole bunch of corn acres, we are figuring out more about the situation in Nebraska and Iowa and that story is not good,” said Ted Seifried, chief ag market strategist of the Zaner Group.
The U.S. National Oceanic and Atmospheric Administration said on Thursday that the extensive flooding in Nebraska and Iowa would persist in the wider region through May and become more dire as water flows downstream.
Chicago Board of Trade May corn climbed 4-3/4 cents to $3.76-1/4 a bushel in the contract’s steepest rise since Feb. 12, while May soybeans were up 4-1/2 cents at $9.10-1/2 a bushel.
CBOT May wheat rose 1-3/4 cents to $4.66-1/2 a bushel, adding to a nearly two per cent gain the previous day. The contract held technical support at its 20-day moving average.
Export sales for corn and wheat last week were in line with trade expectations, according to U.S. Department of Agriculture data released on Thursday. But soybean sales were well below expectations, with minimal reported sales to China.
Traders have been monitoring U.S.-China trade talks for weeks and watching for any additional goodwill purchases of agriculture products.
U.S. President Donald Trump warned on Wednesday that the U.S. may leave tariffs on Chinese goods for a “substantial period” to ensure that Beijing complies with any trade agreement.
— Karl Plume reports on agriculture and ag commodities for Reuters from Chicago; reporting by Naveen Thukral in Singapore and Sybille de La Hamaide in Paris.