Chicago | Reuters — U.S. soybean futures hit their highest levels in nearly two months on Thursday and wheat futures rose more than two per cent as a weaker dollar bolstered export prospects for U.S. grains and oilseeds, analysts said.
Corn futures followed the firm trend.
Chicago Board of Trade July soybeans settled up 10-1/4 cents at $8.67-3/4 per bushel after reaching $8.73-1/4, the contract’s highest level since April 13 (all figures US$).
CBOT July wheat ended up 11-3/4 cents at $5.23-3/4 a bushel after touching $5.29, its highest level since April 28, and July corn finished up five cents at $3.29 a bushel.
Soybeans climbed after the U.S. Department of Agriculture for the second day in a row confirmed sales of U.S. soybeans to unknown destinations. Traders have said that China was the likely buyer both times, despite rising political tensions between Beijing and Washington.
The dollar weakened this month while Brazil’s currency, the real, has firmed, making U.S. soy more attractive to global buyers. Brazil is the world’s biggest soy exporter.
“We are doing a fair amount of business. The U.S., I am told, is the cheapest soybean origination out through January,” said Tom Fritz, a partner with EFG Group in Chicago.
Technical buying in soybeans accelerated as the CBOT July soybean contract pushed above its 50-day moving average this week. CBOT July corn also broke through its 50-day moving average but chart resistance persists near $3.30 a bushel.
“The demand (for corn) is so bad and the supplies are so huge that it’s really going to struggle up here,” said Jack Scoville, analyst with the Price Futures Group.
Favourable crop weather in the U.S. Corn Belt, with warm temperatures and periodic showers, should boost yield potential.
CBOT wheat surged on technical buying, the weaker dollar and dryness in parts of the southern U.S. Plains where wheat is still developing. The weekly U.S. Drought Monitor showed moderate drought across 27 per cent of Kansas, the top U.S. wheat state.
— Julie Ingwersen is a Reuters commodities correspondent in Chicago; additional reporting by Gus Trompiz in Paris and Naveen Thukral in Singapore.