U.S. grains: Corn, wheat up on short-covering ahead of long weekend

Chicago | Reuters –– U.S. corn and wheat futures each jumped one per cent or more on Friday, shrugging off earlier losses as investors took profits on bearish short bets ahead of a three-day holiday weekend, traders and analysts said.

Soybeans eased at the Chicago Board of Trade, pressured by a steep downturn in soymeal prices following hefty meal deliveries against the expired January contract.

Sharply lower equities and crude oil prices overshadowed agriculture markets while global grain and oilseed supplies were ample.

“We’re just closing out shorts ahead of the weekend,” said Jack Scoville, analyst and broker at the Price Futures Group in Chicago.

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“With everything that’s going on in the world… why take the risk of having something happen over the weekend?” he said of investors exiting their short positions.

U.S. markets will be closed on Monday for the Martin Luther King Jr. Day holiday. Stocks sank in volatile trading and oil prices dived below $30 per barrel, pressured in part by worries of slowing economic growth in China (all figures US$).

CBOT March corn settled up 5-1/4 cents at $3.63-1/4 per bushel and CBOT March wheat up five cents at $4.73-3/4.

Wheat rebounded after declining two sessions in a row while corn prices were hovering near a roughly two-week high reached on Tuesday. On continuous charts, corn gained 1.8 per cent for the week and wheat lost 1.1 per cent.

“Grains found support from technical short covering and limited country movement,” MaxYield Cooperative analyst Karl Setzer said in a note.

The U.S. Commodity Futures Trading Commission said in a report after the close of trading that speculative investors as of Tuesday extended their net short in corn to nearly 240,000 contracts, the second-largest in records going back to 2006. Investors trimmed their net short in wheat slightly to 112,767 contracts from what had been a record net short of 130,481 contracts in the previous week.

Soybeans for March delivery eased 3-1/4 cents to $8.79 per bushel, losing ground for the first time in fourth sessions. Soybeans for the week gained 1.5 per cent. CFTC data also showed speculative investors, a category that includes hedge funds, trimming their net short to 104,809 contracts.

The U.S. National Oilseed Processors Association in a monthly report at midday said the U.S. soybean crush in December was 157.711 million bushels, roughly in line with analyst expectations but the smallest crush for that month since 2011.

Michael Hirtzer reports on agriculture and ag commodity markets for Reuters from Chicago. Additional reporting for Reuters by Justin Madden in Chicago, Nigel Hunt in London and Colin Packham in Sydney.

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