Wheat, soybeans end Wednesday higher
Wheat futures rose 0.7%, the seventh increase in eight sessions, on speculation that Brazil will buy more of the grain from the U.S. as crop conditions in Argentina decline. Soybeans also gained while corn was unchanged.
Brazil may purchase more wheat from the U.S., the world's biggest exporter, as dry weather in Argentina, which normally supplies Brazil with most of its grain, threatens the crop after a freeze last month hurt prospects, analysts said. Argentina has stopped exporting wheat in an effort to build domestic supplies, forcing Brazil to seek inventories from the U.S. and Canada.
Shipments of U.S. wheat from the start of June through Sept. 19 totaled 12.1 million tons, up 40% from the same timeframe a year earlier, the U.S. Department of Agriculture said in a report Thursday. Some investors who were short the market, or bet prices would fall, are buying back contracts and liquidating their positions, analysts said.
"There is optimism in the export sector, which is providing support," said Shawn McCambridge, a senior grains analyst for Jefferies Bache Commodities LLC in Chicago. "There's some short-covering activity in the wheat market."
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Chicago Board of Trade wheat futures for December delivery rose 4 3/4 cents to $6.86 a bushel. Prices have been rising, but with the government shutdown no export sales reports will be issued, meaning market watchers won't actually know how much the U.S. is shipping to overseas buyers. That may curb price gains, Mr. McCambridge said.
"We will need some confirmation of new business before we feel that higher prices are warranted," he said. "The shutdown is going to keep uncertainty in the market, especially on the export side. Hopefully it won't go too much longer."
Soybeans rose on speculation precipitation in the Midwest starting Thursday will slow the harvest. CBOT futures for November delivery gained 5 3/4 cents, or 0.5%, to $12.73 3/4 a bushel. Corn futures for December delivery on the CBOT were unchanged at $4.39 a bushel.
As much as four inches of rain may fall from Thursday through Saturday, forecaster Commodity Weather Group said Wednesday. That will slow the soybean and corn harvests that were already delayed by late planting in the spring. Frost is likely in North Dakota and South Dakota, but isn't a "notable damage threat" to crops, CWG said.
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(END) Dow Jones Newswires
October 02, 2013 15:23 ET (19:23 GMT)
DJ Wheat Gains 0.7% as Demand Remains Strong; Soybeans Rise->copyright
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