GRAINS-Wheat soars on U.S. output cuts, Russian annexation of Ukraine land
Putin announces annexation of occupied Ukrainian zones
U.S. wheat crop shrinks on drought conditions
Corn climbs on smaller stocks; soybeans dip after bigger-than-expected stocks
(New throughout; changes byline, previous dateline PARIS/SINGAPORE)
By Christopher Walljasper
CHICAGO, Sept 30 (Reuters) -
Chicago wheat spiked on Friday, supported by a drastic cut to U.S. production estimates by the Agriculture Department, and Russia's annexation of parts of Ukraine followed by increased U.S. sanctions.
Corn climbed on smaller-than-expected U.S. stockpiles, while soybeans sank after the USDA noted larger-than-expected stores of the oilseed.
The most-active wheat contract on the Chicago Board of Trade (CBOT) climbed 40 cents to $9.36-1/4 a bushel by 12:29 a.m (1829 GMT).
CBOT corn added 18-3/4 cents at $6.88-1/4 a bushel while soybeans fell 28 cents to $13.82-3/4 a bushel.
The 2022 U.S. wheat harvest was smaller than previously forecast, the USDA said in its annual Small Grain Summary report, cutting its assessment of the U.S. wheat crop to 1.650 billion bushels. This compared with analysts' average estimate of 1.778 billion bushels in a Reuters poll, and 1.783 billion bushels in the USDA's August assessment.
"I see (U.S. wheat) ending stocks dropping down below that 500 million bushel level and getting kind of snug, particularly for our quality milling wheat," said Arlan Suderman, chief commodities economist for StoneX.
Corn also found support from tighter-than-expected stocks, with the USDA pegging corn stocks at 1.377 billion bushels, down from trade expectations of 1.512 billion bushels.
"We chewed through a lot more corn in the livestock sector, because of the drought," said Mike Zuzolo, president of Global Commodity Analytics.
Soybean futures sank after the agency upgraded its stocks assessment to 273.76 million bushels, significantly higher than the average trade guess of 242 million bushels.
Heightening Russia-Ukraine tensions supported wheat and corn futures. Russian President Vladimir Putin proclaimed the annexation of a swathe of Ukraine in a Kremlin ceremony on Friday, noting that attacks against any of this territory would be considered aggression against Russia.
Tensions over the conflict, also heightened by a leak from Russian gas pipelines to Europe, have raised doubts about whether a United Nations-supervised shipping corridor for Ukrainian grain would last. (Reporting by Christopher Walljasper; Additional reporting by Gus Trompiz in Paris and Naveen Thukral in Singapore; Editing by Richard Chang)
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