Chicago | Reuters — Chicago wheat futures closed higher on Wednesday on light short covering, one day after the spot contract fell about one per cent on better-than-expected U.S. wheat condition ratings.
Corn futures firmed while soybeans ended flat after a choppy session.
Chicago Board of Trade July wheat settled up three cents at $4.32-1/2 per bushel, halting a two-day slide (all figures US$). CBOT July corn ended up 1-3/4 cents at $3.71-1/4 a bushel and July soybeans closed unchanged at $9.48-1/4 a bushel.
Commodity funds hold a large net short position in CBOT wheat and corn futures, leaving the market vulnerable to bouts of short covering.
Worrisome weather lent support, with excessive moisture in the U.S. Plains and Midwest raising concerns about yield prospects and grain quality for maturing winter wheat crops.
“Rains were active across much of the Midwest, Plains, and Delta this past week, which continued to slow corn and soybean growth and maintained wetness concerns for both hard red winter wheat and soft winter wheat,” MDA Weather Services said in a note to clients.
Nonetheless, the U.S. Department of Agriculture surprised analysts on Monday by reporting a slight improvement in weekly winter wheat condition ratings.
Corn and soybean futures were choppy as traders mulled the impact of cool and wet conditions on spring crops in the Midwest.
“While planting is at an average pace, it appears as though re-planting may be much greater than initially thought… There is more talk today that some fields may simply go unplanted this year if conditions do not change quickly,” MaxYield Cooperative market analyst Karl Setzer wrote in a note to clients.
The market awaits USDA’s first 2017 condition ratings for corn, which the government expects to release in its next weekly crop progress report on May 30.
U.S. markets will be closed on May 29 for the Memorial Day holiday.
— Julie Ingwersen is a Reuters correspondent covering grain markets from Chicago. Additional reporting for Reuters by Naveen Thukral in Singapore and Sybille de La Hamaide in Paris.