Wheat Bounces Up From 11-Month Low On Bargain Buying
Category: Grains
(Agriculture.com) – Chicago wheat futures rose on Tuesday, supported by bargain buying after hitting their lowest since early January in turn because of abundant global supplies.
Soybeans hit their lowest in about three weeks on expectations of improved crop weather in Argentina and the sluggish pace of U.S. exports.
The mood was restrained ahead of monthly world agricultural supply and demand estimates due for release by the U.S. Department of Agriculture (USDA) at 1700 GMT on Tuesday.
Most active March wheat on the Chicago Board of Trade was up 0.3 percent at $4.15 a bushel at 1051 GMT. On Monday, wheat touched its lowest for a most-active contract since Jan. 4 at $4.10-3/4 a bushel.
January soybeans fell 0.1 percent to $9.81-1/2 a bushel having earlier dropped to their lowest since Nov. 17 at $9.78-3/4 a bushel. March corn rose 0.1 percent to $3.49-1/2
a bushel.
“Ahead of the USDA reports, wheat and corn are seeing some support from bargain buying after their lows on Monday,” said Matt Ammermann, commodity risk manager at INTL FCStone.
“Soybeans are seeing weakness after forecasts of more rain in Argentine crop regions.
“Weather in the South American soybean regions, especially Argentina and Brazil, is currently the dominant soybean market factor.
Significant damage to South American crops could
push more soybean export sales to the United States. “I think the market is regarding the USDA reports later on Tuesday without fear of major fireworks.
This is partly because of the shift in focus towards South American crop weather rather than U.S. conditions.”
Weekend rain in Argentina’s soybean crop areas and forecasts for more moisture next week eased worries about dryness stressing crops in the South American country, dragging on prices.
Argentina is a key soybean producer and the world’s top exporter of soymeal and soyoil.
Showers in Argentine soybean regions should become more widespread and heavier during the next six to 10 days, which would finally lead to notable improvements, the MDA Weather Services said.
“On corn and wheat, the background picture is still of large global supplies,” Ammermann said.
“Russian and other Black Sea exporters continue to ship their supplies onto world markets at a high rate as a warm start to the winter helps their logistics.” Russia has been aggressively selling its record crop. Most of Ukraine’s winter grain crops are in a good or satisfactory state due to the favourable weather.
