Chicago | Reuters –– Chicago Board of Trade wheat futures ended steady on Friday but fell six per cent for the week as drought-relieving rains arrived in the southern U.S. Plains crop belt.
Corn futures firmed in a technical bounce after falling to a near one-month low this week, and soybeans posted a slight gain.
At the CBOT, May wheat settled unchanged at $4.94-1/2 per bushel (all figures US$). May corn ended up 3-1/2 cents at $3.79-3/4 per bushel and May soybeans rose 2-3/4 cents to $9.68-3/4 a bushel.
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Wheat held steady despite the arrival of much-needed rains in the drought-hit U.S. Plains. Storms since Thursday brought 0.25 to 1.5 inches of rain to the hard red winter wheat belt, with some local amounts near 2.5 inches in northwestern Kansas and central Oklahoma. Showers were expected to continue this weekend.
“Overall, the vast majority of the HRW (hard red winter wheat) belt is seeing some much improved conditions,” MDA Weather Services meteorologist Don Keeney said.
The storms had been widely anticipated and were already factored into prices. Front-month K.C. hard red winter wheat futures neared a five-year low this week, while CBOT May wheat fell nearly 50 cents from its April 2 high of $5.44-1/4.
Commodity funds hold a large net short position in CBOT wheat, limiting further declines and leaving the market open to occasional short-covering rallies. But poor export demand for U.S. supplies continues to anchor prices.
“You’ve got a big-picture competitive issue. Russian wheat is still $50 a tonne under our market,” said Terry Linn, analyst at the Linn Group in Chicago.
Russia’s agriculture ministry proposed canceling a tax on wheat exports from July 1, a ministry source told Reuters.
CBOT corn notched its highest close since April 7 and ended the week up 0.7 per cent but stayed well within the $3.70-$4 range it has occupied since January. Recent rains disrupted seeding in southern and eastern portions of the U.S. Corn Belt, but planters were rolling farther north.
Soybeans rose 1.8 per cent this week, but rising world stocks hung over the market, limiting rallies. Farmers in South America are harvesting large crops, and U.S. producers are projected to plant a record-large number of acres with soybeans in the coming weeks.
— Julie Ingwersen is a Reuters correspondent covering grain markets from Chicago. Additional reporting for Reuters by Ahmed Aboulenein in London and Naveen Thukral in Singapore.
