(Reuters) – Chicago corn futures were little changed on Tuesday, trading around their highest in almost three weeks, while wheat held on to recent gains in cautious trade ahead of the U.S. government’s monthly supply-demand report.
Soybeans were also steady, underpinned by concerns over dryness in Brazil which could reduce yields in what is expected to be a record large crop.
Chicago Board Of Trade March corn dipped a quarter of a cent to $3.91 a bushel by 0221 GMT, having gained 1.4 percent to its highest since Jan. 21 in the previous session.
March soybeans rose a quarter of a cent to $9.78-3/4 a bushel, having firmed 0.5 percent on Monday and wheat added 0.25 cents to $5.30 a bushel.
“The market is waiting to see what is going to happen in the USDA report, obviously the trend has been of lower prices and good supplies across the board,” said Phin Ziebell, agribusiness economist, National Australia Bank.
“Certainly, we have seen some welcome rains in the U.S. over the past month and we haven’t seen the kind of conditions which will result in a significant downward revision in yields.”
The gains in wheat and corn futures this week have been driven largely by investor short-covering and position-squaring ahead of the U.S. Department of Agriculture report due at 1700 GMT.
The USDA was likely to make only minor adjustments to its forecasts, and global grain supplies were ample in the early days of bumper South American harvests, which follow record-high U.S. corn and soy crops last autumn.
Australia raised its forecast for the just harvested 2014/15 wheat crop on Tuesday as timely rains in key growing regions aided yields in the world’s fourth-largest exporter.
Wheat production totalled 23.61 million tonnes, the Australian Bureau of Agricultural and Resource Economics and Sciences said, up from its December estimate of 23.22 million tonnes, and the eighth biggest harvest on record.
The USDA reported on Monday top soybean importer China purchased 120,000 tonnes of the grain in 24 hours, while analysts at AgRural and FCStone reduced forecasts for the crop in Brazil.
Some traders were exiting short positions ahead of the report after U.S. Commodity Futures Trading Commission data released on Friday showed a spike in bearish bets in corn and wheat. Investors, including hedge funds, had their smallest long stake in corn since October
