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IKAR in Mass Media

US wheat climbs to 2-week high on western European rain

31 августа 2014 года

LONDON: Chicago wheat rose to a two-week high on Monday, rising for a fourth consecutive session, as quality concerns in western Europe increased investor appetite for U.S. wheat.

Corn and soybean prices also edged higher although the upside for both commodities stayed capped by the prospect of near-record production in the United States.

Chicago Board Of Trade (CBOT) September wheat rose 1.5 percent to $5.42 a bushel by 1104 GMT after climbing to $5.45-3/4, the highest level for the contract since July 18.

"There has been rainfall in Germany which is the main reason for driving prices higher today, so importers are buying U.S. wheat as a hedge," one Sydney-based trader said.

Repeated rain that has spoiled part of the French wheat crop is threatening to cause quality problems in Germany and Poland, increasing the likelihood the European Union will have more feed wheat and less milling crop to sell this season.

The market is recovering slightly after a prolonged slide driven by ample supplies and an improved export outlook in the Black Sea region which helped to drive September CBOT wheat to a contract low of $5.18-1/2 last week.

Russia, one of the world's major wheat exporters via the Black Sea, is likely to harvest 58.5 million tonnes of wheat in 2014, the largest crop for six years, IKAR, one of Russia's leading agriculture consultancies, said on Monday.

"The tendency remains bearish although (CBOT) wheat could profit from the current situation in Europe where quality issues pose a certain threat," Agritel market analysts said in a note.

Large speculators increased their net short position in CBOT wheat futures in the week to July 29, regulatory data released on Friday showed.

RECORD SHORT

"The prospect of plentiful supply is leading short-term-oriented market participants to expect wheat prices to decline further, as evidenced by net short positions soaring to a record level at the end of July," Commerzbank said in a market note.

November wheat futures in Paris rose 0.7 percent to 173 euros a tonne with the market edging further away from a 4-year low of 167 euros hit last week.

Soybeans and corn prices were slightly higher as dealers continued to keep a close watch on the weather forecast in the important U.S. Midwest growing region.

"The key growing period for soybeans in the U.S. is the month of August and despite the optimistic forecasts, risks remain regarding the realisation of the crop," Rabobank said in a report.

"The risk premium has been evident in recent days as soybean prices recovered 5 percent of profit taking and weather forecasts call for the U.S. Midwest to be drier than normal in August," the report said.

CBOT November soybeans rose 0.8 percent to $10.67-1/4 a bushel while CBOT December corn climbed 0.5 percent to $3.64 a bushel.

"Dryness in the northwest of Iowa and southern Minnesota are causing concern. However, a (corn) crop rating of 75 percent good to excellent is the best since the massive yields of 2004," Rabobank said.

Source: Business Recorder  |  #grain   |  Comments: 0   Views: 67

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