(Reuters) – U.S. wheat rose to a more than one-week high on Wednesday, gaining for a second session as cold weather threatened to curb yields in top exporters the United States, Russia and Ukraine.
Soybeans slipped, giving up some of the previous session’s gains, while corn added to Tuesday’s 1.8 percent rise on strong demand from ethanol producers and animal feed makers.
“The world will lose some wheat but not enough to move us too far from a comfortable supply position,” Tobin Gorey, an analyst at Commonwealth Bank of Australia, said in a note to clients. “Nonetheless even in that context there might be a case for the higher quality wheat to trade at larger premiums.”
Chicago Board of Trade actively traded March wheat contract rose as much as 0.7 percent to $5.61-1/2 a bushel, highest since Nov. 17. Soybeans gave up 0.1 percent to $10.50 a bushel, while corn rose 0.1 percent to $3.74-3/4 a bushel.
Wheat is being underpinned by cold weather hitting freshly planted winter crops. The U.S. Department of Agriculture rated 58 percent of the U.S. winter wheat crop as good to excellent, down from 60 percent the previous week, after the cold spell.
Major Black Sea wheat producers Russia and Ukraine may fail to harvest a record wheat crop next year due to the poor condition of their winter plantings, traders and forecasters said.
U.S. FOB Gulf corn basis offers were 5 to 7 cents a bushel higher for January to March loadings with a firmer barge market and competition from processors helping boost flat prices.
The rally in soybeans on Tuesday was driven by gains in soymeal, a key protein source in animal feed, which remained in short supply domestically.
The record-large U.S. soybean harvest is 97 percent complete, but robust export sales of soybeans and soymeal have kept domestic processors in the hunt for fresh supplies.
Soy prices also drew support from a Congressional Budget Office preliminary forecast for a drop in U.S. soybean plantings by 2 million acres in 2015, traders said.
Commodity funds bought a net 9,000 Chicago Board of Trade soybean contracts on Tuesday, trade sources said. The funds bought 8,000 in corn and 4,000 in wheat.
