Wheat hits 11-week high

October 04, 2013


US wheat climbed to an 11-week high on Wednesday on bets that slow grain shipments out of the Black Sea region could help maintain the brisk pace of US exports. Soyabeans also gained at the Chicago Board of Trade, rebounding from a recent 19-month low on light investment fund buying of agricultural commodities.

Corn ended flat, just above the three-year low notched overnight. “The renewed optimism in the export sector continues to provide support (for wheat prices). The only caveat is that we need confirmation pretty soon – and that may be hard to come by,” said Shawn McCambridge, an analyst at Jefferies Bache.

The US Agriculture Department is shut down due to the budget impasse in Washington and is not issuing any reports, including daily announcements of export sales larger than 100,000 tonnes or the suite of export sales data that typically comes out on Thursdays.

Heavy rains in Ukraine will reduce winter grain sowing areas and slow exports, the country’s agriculture minister told Reuters this week. Exports also slowed out of Russia last month.

The Black Sea countries have routinely undercut offers from the United States in recent years, capturing wheat export business to top buyers such as Egypt. The slowdown in exports from that region could push some demand to the United States. Only four months into the marketing season, after large sales to Brazil and China, US exporters have already sold half of the 29.9 million tonnes of wheat forecast for export this year by the US Agriculture Department.

Wheat futures have declined on only two days in the past two weeks. CBOT wheat for December delivery settled 4-3/4 cents higher at $6.86 per bushel while Kansas City Board of Trade December wheat gained 10 cents, or 1.3 percent, at $7.55. The US winter wheat crop was 39 percent planted as of Sunday, on par with the five-year average planting pace of 40 percent, USDA said earlier this week.

Investment funds were said to have purchased 3,000 contracts of both wheat and soybeans and were even in corn futures, trade sources said. CBOT December corn settled unchanged at $4.39 per bushel after earlier falling to $4.35 – the lowest level since September 2010. Soybeans for November delivery gained 5-3/4 cents to $12.73-3/4 per bushel, with support from a 2 percent bump in soyameal futures. Soyameal gained in the wake of several tenders out of South Korea, which has purchased 209,000 tonnes of soyameal from global buyers so far this week. Courtesy: Reuters

Published in ZaraiMedia.com

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