Wheat at three-week peak
March 22, 2013
Chicago Board of Trade (CBOT) wheat futures rose to a three-week high on Wednesday on brisk demand from feeders and exporters, while corn rose to a six-week high with the market buoyed by tight stocks, firm cash and slow farm sales. “Wheat strength is the easier trend to identify today. Wheat remains very competitive to corn, underpinning its demand as feed,” said Bryce Knorr, senior editor for Farm Futures Magazine.
“Short-covering remains one primary cause of buying, with hedge funds short in both Kansas City and Chicago,” he said. Soft red winter wheat basis bids, the kind of wheat traded on the CBOT, rose 5 cents per bushel at elevators in Chicago and northern Indiana late on Tuesday, cash merchants said.
Soyabeans rallied after falling for six straight sessions, supported by tight US soya supplies, concerns about shipment delays in Brazil and belief that China will repurchase soyabeans after cancelling import contracts with Brazil. A falling dollar, firm crude oil and gains in the stock market helped underscore advances in grains and soyabeans.
CBOT May wheat futures were up 14 cents per bushel at $7.36 and Kansas City Board of Trade (KCBT) hard red winter wheat for May delivery was up 12-1/4 at $7.64. Chart-based traders said CBOT wheat had technical strength today, including May breaking through a double-top at $7.25 and the March 1 high of $7.26-3/4, setting off some short-covering. Technical traders said the next target was the 40-day moving average moving average at $7.39-1/2.
European milling wheat futures rose to a one-month high, boosted by a jump in CBOT futures and a break in the Paris wheat market above a recent technical resistance level. CBOT May corn was up 4 cents per bushel at $7.32-1/2 and May soyabeans were up 13 cents at $14.19-3/4.
US wheat exports, already brisk, are expected to rise further in the near future as rival suppliers Australia and the Black Sea region run low on surplus stocks to sell in global markets after poor harvests. “Wheat is continuing to profit from robust demand,” Commerzbank analyst Carsten Fritsch said, stressing strong international purchase interest.
A mill in Oman bought 10,000 tonnes of Indian wheat on Wednesday and Algeria bought 350,000 tonnes of optional-origin wheat. Also, Jordan’s state grains buyer has issued a tender to buy 100,000 tonnes of milling wheat, Bangladesh is seeking to import 50,000 tonnes, while Iraq is tendering for at least 50,000 tonnes and Iran has recently enquired about buying US wheat. Source Reuters.
Published: Zarai Media Team