CHICAGO, May 23 (Reuters) – U.S. soybean futures scaled to a 2-1/2-week high on Wednesday as signs of renewed Chinese demand for U.S. exports lifted prices for a fourth straight session.
Corn reached a 9-1/2 month peak on concerns about planting and early crop development due to adverse weather, while wheat extended prior-session gains as dry conditions in key production areas around the world threatened crops.
News that Beijing has given soy processors the green light to import U.S. soybeans again fueled the market’s bullish momentum following an easing of trade tensions between the United States and China since the weekend.
China’s state grain stockpiler Sinograin made enquiries about prices for U.S. soybeans after being largely absent for the last six weeks, traders said, seen as a sign that government curbs on buying American goods had been lifted.
“We’ve got what appears to be an initial resumption of Chinese availability to buy U.S. soybeans. Whether that happens, how much and for what time frame will depend on market conditions,” said Jim Gerlach, president of A/C Trading.
Chicago Board of Trade July soybeans settled 8-3/4 cents higher at $10.39-1/4 a bushel after hitting a peak of $10.39-3/4 early in the day, the highest since May 7. The contract encountered chart resistance around its 50-day moving average of $10.38.
CBOT July corn was up 3-3/4 cents at $4.08-1/2 a bushel, the highest since Aug. 10, and CBOT July wheat gained 8-1/2 cents to $5.30 a bushel, a 2-1/2 week high. Both climbed because of worries about adverse crop weather.
Overly wet conditions have stalled corn planting in the northern Midwest, potentially prompting a shift by farmers to grow soybeans or other crops that can be planted later in the spring instead.
Meanwhile, worsening dryness in parts of the central Corn Belt increased concerns that recently seeded crops could be facing a tough growing season ahead.
Wheat traders weighed risks to crop yields from dryness in the U.S. Plains and several other key wheat-producing zones worldwide.
The U.S. Department of Agriculture said just 36 percent of the U.S. winter wheat crop was in good-to-excellent shape, as of Sunday, compared with 52 percent at the same point last year.
Dry weather in parts of Canada, Australia and Russia – all major wheat exporters – has added to crop worries, although the global market is set for record inventory levels at the end of the current season.