Chicago | Reuters — U.S. wheat futures jumped as much as one per cent on Tuesday, extending gains from the previous session to a two-month high as investors bet that heavy rains would hit yields of the winter wheat crop in the southern U.S. Plains.
Soybeans also rose, reaching a three-week peak as a broad-based commodities rally pushed up crude oil, copper and gold. The dollar lost ground for the second straight session, making goods priced in the greenback more attractive in international markets.
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“They’re getting some money flow today, not just in grains but in the commodities as a whole,” said Water Street Solutions analyst Arlan Suderman.
Rains were forecast from Friday and during the six-to-10-day outlook in the southern Plains wheat belt, the Commodity Weather Group said, slowing harvest after the wettest May on records. Elevators were monitoring grain quality as farmers started to gather their wheat.
“Wheat is pretty golden in southern Kansas and we’re going to start harvesting in a couple days, and that’s just when the rains are going to come,” Suderman, based in Wichita, said.
Investors were squaring positions ahead of a U.S. Department of Agriculture monthly supply and demand report due on Wednesday. Analysts, on average, expected the government to boost ending stocks estimates for wheat and corn, and reduce its supply outlook for soybeans for the 2014-15 marketing season, according to a Reuters poll.
Chicago Board of Trade wheat for July delivery finished 4-1/4 cents higher at $5.32-1/4 per bushel, after earlier reaching $5.37-1/4 — the highest since April 6 (all figures US$).
CBOT July soybeans were up 7-1/4 cents to $9.51-1/2 per bushel, further supported by a 2.2 per cent spike in soymeal futures. Soymeal climbed as U.S. processors idled their crushing plants for seasonal maintenance, tightening supplies of the animal feed.
Corn for July delivery edged 1/4 cent lower to $3.65, retreating in a profit-taking selloff after an earlier three-week high of $3.68-1/2.
USDA on Monday slashed good-to-excellent condition ratings for the winter and spring wheat crops, and showed that the pace of soybean plantings was slightly below average. The condition of the corn crop was unchanged, USDA said.
“The high percentage of soybeans unplanted in Kansas and Missouri, and to a lesser extent Nebraska, amounts to 7.6 million acres not in the ground based on what was planted last year,” said Rich Feltes, an analyst with RJ O’Brien.
— Michael Hirtzer reports on grain markets for Reuters from Chicago. Additional reporting for Reuters by Christine Stebbins in Chicago and Manolo Serapio Jr. in Singapore.
