U.S. grains: Wheat down on forecasts for Plains moisture

CBOT soybeans and corn both end higher

Chicago | Reuters — U.S. wheat futures fell to a one-month low on Thursday, pressured by forecasts for welcome moisture in the southern U.S. Plains crop belt that should boost wheat production prospects, traders said.

But soybean and corn futures ended higher, supported by South American supply worries and soaring global vegetable oil prices.

Chicago Board of Trade May wheat futures settled down 10 cents at $6.42-1/2 per bushel after dipping to $6.39, the contract’s lowest level since Feb. 12 (all figures US$).

CBOT May soybeans ended up 3-3/4 cents at $14.13-1/2 a bushel and May corn rose 4-1/2 cents to finish at $5.38-1/2 per bushel.

Weekend storms were taking aim at the Plains wheat belt, much of which has endured dry conditions for several months. The region’s winter wheat is just starting its key spring growth phase, when the crop’s need for water increases.

“A much wetter (and snowier) weather pattern is expected across the central Plains through early next week, which will significantly ease dryness in Colorado, Nebraska, Kansas, and Oklahoma,” space technology company Maxar said in a daily client note.

Meanwhile, Egypt’s state grains buyer, the General Authority for Supply Commodities (GASC), bought 360,000 tonnes of Romanian wheat in an international purchasing tender, its first since early February.

Soybean futures rose as CBOT soyoil futures set across-the-board contract highs and rival Malaysian palm oil futures notched a 13-year top.

“Soybean oil futures traded to new contract highs on the upside explosion in world vegetable oil prices,” DC Analysis president Dan Cekander said in a client note.

Uncertainty about South American crop prospects lent support. The Buenos Aires Grains Exchange lowered its estimates of Argentina’s soybean harvest to 44 million tonnes and its corn forecast to 45 million tonnes, below its previous forecasts of 46 million tonnes for each crop, citing dry conditions.

However, in neighbouring Brazil, government supply agency Conab raised its estimates of Brazil’s 2020-21 soybean and corn harvests.

An analyst with Safras + Mercado projected Brazilian farmers will harvest a record 2020-21 corn crop of 113.5 million tonnes, even as growers sow their second corn crop outside the ideal planting window.

— Reporting for Reuters by Julie Ingwersen in Chicago; additional reporting by Naveen Thukral in Singapore and Sybille de La Hamaide in Paris.

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