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Grains Close Higher Monday on Positive Demand News

Grains and soybeans finished higher after trading mixed early on Monday amid signs of improving demand for U.S. inventories. 

Exporters said they will ship 100,000 metric tons of hard-red spring wheat to China in the marketing year that ends on May 31, switching from previously unknown destinations. While that's not a huge sale, it's interesting in the fact that the buyer is China. 

Last week's export sales report was a somewhat promising indicator that perhaps demand is returning to the U.S. amid export problems in Brazil. 

Still, demand for corn, beans and wheat since the start of their respective marketing years is down from last year as slowing global growth curbs purchases by overseas buyers. Corn sales are down by a fifth versus the year-ago pace, wheat sales are down by 17% and soybean sales are off by 10%, according to the U.S. Department of Agriculture.

Investors also may be wary of selling contracts after money managers last week boosted their net-short positions, or bets that prices would fall, in corn to a record. 

Speculative investors are notoriously nervous and could begin buying back contracts at even the hint of bullish news. So far, however, there are few positive fundamental factors that would push up prices, analysts said. 

Corn futures for May delivery gained 3 1/4 cents to close at $3.68 1/4  a bushel on the Chicago Board of Trade. 

Soybean futures for May delivery rose 1/4 cent to $8.96 a bushel in Chicago. Soymeal futures declined $1.50 to $272 a short ton, and soyoil gained 0.30 cent to 32.43 cents a pound.

Wheat contracts for May delivery in Chicago added 2 1/2 cents to $4.78 1/4 a bushel, while Kansas City futures rose 5 1/4 cents to $4.88 1/4 a bushel. 

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