Chicago | Reuters – Chicago corn and soybean futures prices rallied on Tuesday as hot, dry conditions threatened both crops.
Wheat climbed on concerns over implementation of an agreement to open a corridor for Ukrainian grain exports, following a Russian missile strike on the Ukrainian port of Odesa over the weekend.
The most-active corn contract Cv1 on the Chicago Board of Trade (CBOT) added 17 cents to $6.00-3/4 a bushel, after hitting its highest since July 19 at $6.02-1/2 a bushel.
Soybeans Sv1 gained 37-3/4 cents to $13.83-3/4 a bushel, while wheat Wv1 firmed 33-3/4 cents higher at $8.03-3/4 a bushel.
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The U.S. Department of Agriculture’s weekly condition ratings for corn, soybeans and spring wheat on Monday fell more than most analysts expected, while upcoming forecasts call for more sweltering heat across the U.S. Midwest and Plains.
“We’ve got a disconcerting weather forecast for next week. Some extreme heat moving into the Midwest,” said Brian Basting, Commodity Research Analyst at Advance Trading. “If we start of the month of August with that type of heat, the market’s building in some weather premium.”
Hot and dry weather during crucial corn pollination and soybean pod development is likely to provide further bullish momentum to the markets.
The wheat market fell last week, pulling corn and beans lower after Russia, Ukraine, the United Nations and Turkey signed a deal on Friday to reopen three Ukrainian Black Sea ports for grain exports. The Russian missile strike on Odesa created scepticism.
“I think this market is on edge, saying hey, maybe we took it too far, and thought everything was going to be fine and the grain was going to get out of Ukraine,” said Kristi Van Ahn-Kjeseth, chief operating officer at consulting firm Van Ahn and Company, Inc.
Moscow brushed aside concerns the deal could be derailed, saying it targeted only military infrastructure. Ukraine denounced the attack as showing that Moscow cannot be trusted.
Additional reporting by Sybille de La Hamaide and Naveen Thukral; Editing by Marguerita Choy)
