(Nasdaq) – U.S. grains and soybean futures rose Wednesday, amid fresh buying in agricultural markets ahead of a closely watched crop report.
Soybeans led the gains, advancing as expectations mount that the U.S. Department of Agriculture in a monthly report on Aug. 12 will trim its estimate for U.S. soybean sowings this year thanks to heavy June rains which stymied planting in some regions. In July, the USDA said it would resurvey soybean growers in Arkansas, Kansas and Missouri–where drenching rains prevented many farmers from seeding their fields–and issue any revised planted acreage estimates in its August report.
“This is evening up going into the all-important August 12th crop report,” said Don Roose, president of U.S. Commodities, a brokerage in West Des Moines, Iowa, adding that anxiety in agricultural markets typically picks up as the late summer report nears. This year, Mr. Roose said, much uncertainty exists around the soybean crop. “We’re debating the yield, and we’re still debating what the real acres are, so there are two things to worry about,” he said.
Forecasts for drier-than-expected weather in the U.S. Midwest also buoyed prices for the oilseeds. August is a critical month for soybean growth, and an extended period of dryness after extreme wet conditions could harm crops, analysts said. Strong margins for domestic soybean processors further supported prices on Wednesday, analysts said.
Soybeans for August delivery gained 11 3/4 cents, or 1.2%, to $9.87 3/4 a bushel at the Chicago Board of Trade.
Wheat prices jumped, bolstered by sentiment among market participants that prices for the crop had fallen far enough to be competitive on the world market, which spurred a technical bounce, analysts said. Ample global wheat supplies and weak demand for U.S. rations pushed prices steadily lower for much of July.
“We’ve reached some areas where we’re starting to get a little demand interest,” said Mr. Roose. “Still, there’s lots of wheat in the world, which will limit how far prices can rally.”
CBOT September wheat added 8 1/4 cents, or 1.7%, to $5.01 3/4 a bushel.
Corn prices also notched higher, bolstered by a weather outlook for the Corn Belt showing dryness in six to 10 days and only light showers in 11 to 15 days. Prolonged lack of precipitation could stall crop development, as soaking rains earlier in the season left many plants with shallow roots and vulnerable to stress.
CBOT September corn gained 3 1/4 cents, or 0.9%, to $3.72 a bushel.
