October 25, 2013
Chicago Board of Trade wheat futures rebounded to near a four-month high on Wednesday on concerns about the fate of crops in several key regions, including the Black Sea, Australia and Argentina. “The thought is that South America will be a big importer of US wheat this year. South America’s wheat crop is in bad shape compounded by acreage shifts to corn and soyabeans,” said Ted Seifried, an analyst for Zaner Ag Hedge. He said Brazil is the world’s third-largest wheat importer and they normally import most of their needs from Argentina, but crop and weather issues there may shift the business to the United States.
CBOT corn followed wheat higher and garnered additional support from short-covering, while soyabeans gained on brisk export sales of the US crop, including a sale on Wednesday of 120,000 tonnes to Russia. Slow farmer selling of corn and soyabeans despite active harvesting of each crop in the United States also contributed to the advances of corn and soyabean futures.
Chicago Board of Trade December wheat closed a penny per bushel higher at $7.01-3/4, December corn was up 4-1/2 at $4.42-3/4 and November soyabeans gained 7-3/4 to $13.10. Technical traders cited chart resistance for the CBOT December wheat contract at its 200-day moving average of $7.12 per bushel. The session high was $7.10-1/2.
Traders said the wheat market, which has risen four out of the past five trading sessions, was getting significant attention as CBOT spot wheat futures have gained 4.7 percent for the month. “There is still concern that Argentina will not allow wheat exports in December and limit exports in January and February until the Agriculture Ministry has a better handle on harvested supplies,” said Sterling Smith, a futures specialist for Citigroup.
The United States has been selling wheat to Brazil recently due to the lack of supplies in neighbouring Argentina and very high prices in South America. There was additional support for wheat on forecasts of dry weather in Australia, the world’s second-largest exporter.
Australia is expected to experience hotter and drier weather than normal across much of the country over the next three months, the weather bureau said on Wednesday, potentially threatening agricultural production such as wheat. “People are also saying frost damage to Australian wheat was pretty extensive,” a trader said. Although corn futures held firm on Wednesday, gains were slowed by active harvesting of the US crop and reports of bigger-than-expected yields. Courtesy: Reuters
Published in ZaraiMedia.com
World Agriculture News, Wheat