You are here

GRAINS-Wheat rises for second day on surprise French forecast cut

* Analyst cut to French wheat crop adds to global concerns * Corn flat as Midwest heat assessed, soybeans edge up (Updates with European trading, changes byline/dateline) By Gus Trompiz and Naveen Thukral PARIS/SINGAPORE, July 2 (Reuters) - Chicago wheat rose for a second day on Monday as a widely followed analyst's steep cut to France's harvest outlook fuelled concerns about weather risks to global production. Corn was almost unchanged, holding onto Friday's gains as investors assessed hot weather in the U.S. Midwest as crops enter a crucial development month. Soybeans rose slightly after a two-session drop linked to trade tensions between the United States and China. The most-active wheat contract on the Chicago Board Of Trade rose 1.1 percent to $5.06-3/4 a bushel by 1101 GMT, having closed up 3.7 percent on Friday. On Paris-based Euronext, December milling wheat also extended Friday's gains, adding as much as 4 euros to hit a more than two-week high of 185.75 euros. Analyst firm Strategie Grains sparked Friday's rally when it cut its French soft wheat production estimate by more than 4 million tonnes to 33.2 million in an update to clients. Confirming the estimate, it said on Monday that a field tour had shown problems with crop density and grain development, thought to be linked to heavy rain in winter and late spring. "Previously France had been seen as one ray of hope in what otherwise looks set to be a fairly mediocre EU crop in 2018/19," Commerzbank analysts said in a note. The French forecast cut rattled market participants as it came on top of deteriorating prospects in Germany, the European Union's second-largest wheat producer behind France, and adverse weather in other major wheat growing countries, including top exporter Russia. Crop observers have until now anticipated a decent sized French crop close to or above last year's volume, despite some rain-related disease risks. CBOT corn inched down 0.1 percent to $3.70-3/4 a bushel and soybeans were up 0.2 percent at $8.81-1/2 a bushel. Hotter-than-normal temperatures will persist in the U.S. Midwest through the first week of July, according to agricultural meteorologists. Corn plants are highly sensitive to stressful heat and dryness in July, when the crop goes through the key stage of development called pollination, although recent rain could mitigate the effects of the forecast heat. An escalating U.S.-China trade spat continues to hang over the soybean market, in which China is the leading importer. Beijing has said it will impose an extra 25 percent import duty on more than 500 U.S. goods, including soybeans, on July 6. U.S. Department of Agriculture (USDA) crop reports showed U.S. farmers planted more corn and soybeans than previously thought and had larger stocks of the crops in storage as of June 1 than they did a year earlier. Prices at 1101 GMT Last Change Pct End Ytd Pct Move 2017 Move CBOT wheat 506.75 5.50 1.10 427.00 18.68 CBOT corn 370.75 -0.50 -0.13 350.75 5.70 CBOT soy 881.50 1.50 0.17 961.75 -8.34 Paris wheat Dec 185.25 3.50 1.93 170.00 8.97 Paris maize Aug 166.00 1.00 0.61 167.75 -1.04 Paris rape Aug 359.50 1.25 0.35 349.00 3.01 WTI crude oil 74.09 -0.06 -0.08 60.42 22.62 Euro/dlr 1.16 0.00 -0.35 Most active contracts - Wheat, corn and soy US cents/bushel, Paris futures in euros per tonne (Reporting by Gus Trompiz in Paris and Naveen Thukral in Singaore; editing by David Evans)

© Copyright Thomson Reuters 2018. Click For Restrictions - http://about.reuters.com/fulllegal.asp

Read more about

Talk in Marketing

Most Recent Poll

Will you have enough on-farm storage for harvest?