Wheat rises to seven-month high on low U.S. crop ratings

CHICAGO(Reuters) – U.S. wheat prices rose to
roughly seven-month highs on Tuesday as low crop ratings and
limited chances of rain in drought-hit parts of the Plains
growing region kept attention on the risk of yield losses.
The gains were fueled by U.S. Department of Agriculture data
released late on Monday that rated the wheat crop in top growing
state Kansas at only 12 percent in good to excellent condition,
down 2 points from a month ago.
Wheat ratings also declined in Oklahoma, Montana, the

Dakotas, Nebraska and Colorado.
“One important reason for the poor plant assessments is the
drought that has over 70 percent of Kansas and the whole of
Oklahoma in its grip,” Commerzbank analysts said in a note.
K.C. March hard red winter wheat surged about 2.6
percent, or 11-1/4 cents, to settle at $4.89 per bushel.
Global benchmark Chicago Board of Trade March wheat
was up about 1 percent or 3-3/4 cents at $4.63-1/4. Both were
the highest since late July.
Severe cold in Europe this week was also keeping attention
on weather risks, although snow cover was expected to limit the
impact of deep frosts in top wheat exporter Russia.
Soy prices were sharply higher, with soymeal futures
reaching life-of-contract peaks as scant rainfall in Argentina
continued to threaten harvest prospects in the No. 3 global
producer after Brazil and the United States.
However, the impact on global supply could be curbed by
Brazil’s harvest which some forecasters expect to set a record
CBOT corn futures edged up to the highest since September,
largely tracking gains in wheat and soy while worries of a
smaller Argentine corn harvest pushed more export demand to U.S.
CBOT March soybeans were up 3-3/4 cents or 0.3 percent
to $10.38 per bushel and March soymeal up $9.30 or about
2.5 percent to $386.50 per ton.
CBOT March corn was 2 cents higher at $3.70-1/2.
A meeting between President Donald Trump and senators
representing the oil and corn industries failed to yield an
agreement on how best to lower the cost of the United States’
biofuels policy to refiners.
The lack of a resolution stoked optimism that the U.S. corn
ethanol policy could be safe from a major overhaul at least in
the very near term.
“No deal made,” said Republican Senator Charles Grassley of
Iowa, a key participant in the talks representing corn growers.


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