CHICAGO, March 21 (Reuters) – U.S. wheat rose around one percent on Monday, led by gains in Kansas City hard red winter wheat as extremely cold weather might have damaged crops in parts of the southern U.S. Plains growing region already suffering from dry conditions.
Wheat futures pared early gains on technical selling, keeping prices below the more than one-month peaks reached last week. Corn and soybeans each reversed from narrow losses at the Chicago Board of Trade, rallying amid strength in wheat.
K.C. HRW wheat for May delivery was up 4 cents, or 0.9 percent, at $4.73 ½ per bushel and CBOT May wheat up 3 ¾ cents at $4.66 ¾ as of 10:30 a.m. CDT
As much as 20 percent of the wheat crop was significantly damaged from freezing temperatures over the weekend in southwestern Kansas and western Oklahoma, INTL FCStone analyst Arlan Suderman said in a note to clients.
Drought was developing in that portion of the Plains, with moderate drought conditions in most of Oklahoma’s “panhandle,” leaving plants more at risk of freeze damage than fields with protective snowcover or more significant soil moisture reserves.
“Unfortunately, it will take time to assess the scope of the damage,” Suderman said. “Wheat tillers lost due to a freeze in March can be replaced, albeit with lower-producing tillers.”
CBOT May soybeans were up 4 ¼ cents at $9.01 ¾ per bushel, on pace for their third session of gains and hovering near Friday’s 3 ½ month high of $9.04 ¾ . The contract was hitting upside resistance at its 200-day moving average after reaching the key technical indicator for the first time since August last week.
CBOT May corn was up 2 ½ cents at $3.69 ¼ per bushel, rebounding from the earlier one-week low of $3.65 ¾ .
Soybeans and corn fell overnight, pressured in part by U.S. regulatory data released after the close of trading on Friday showing speculative investors dumping big volumes of their short, or bearish, bets on the commodities.
“Ongoing short-covering is a primary source of support for the market, but we are also seeing strength from weather outlooks,” MaxYield Cooperative analyst Karl Setzer said in a note.
