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336481

Wheat turns higher on dry U.S. winter crop outlook

By Naveen Thukral and Sybille de La Hamaide SINGAPORE/PARIS, Nov 22 (Reuters) - Chicago wheat rose on Tuesday, supported by concerns over dryness across U.S. winter crop areas while soybeans were flat on questions over demand from top importer China, which is facing a rising number of COVID-19 cases.

"U.S. hard red winter wheat areas will continue dry biased and warming this week will attempt to stimulate new plant development in the southern Plains," said Terry Reilly, senior analyst with Futures International.

The most-active wheat contract on the Chicago Board of Trade (CBOT) rose 0.2% to $8.19-1/2 a bushel by 1213 GMT after closing lower the previous day. Soybeans were flat at $14.37-1/4 bushel and corn gained 0.3% to $6.65-1/4 a bushel.

The U.S. Department of Agriculture (USDA) on Monday rated 32% of the U.S. winter wheat crop in good to excellent condition, unchanged from the previous week, while analysts on average had expected a 1-point improvement. The wheat ratings are the lowest for this time of the year in USDA records dating to 1986.

A year ago, 44% of the winter wheat crop was rated good to excellent. The newly planted crop has struggled with dry conditions as 75% of the U.S. winter wheat production area is experiencing drought, according to the government.

Winter crops in most of Europe were off to a good start, helped by historically warm weather and sufficient moisture but a lack of rain was prompting concern in the southern region, the European Union's crop monitor MARS said. Russian wheat prices fell last week amid an extension of the Black Sea deal allowing Ukrainian grain shipments, analysts said on Monday.

Tightened COVID-19 rules in China fuelled worries over the global economic outlook and demand for commodities. Beijing warned it was facing its most severe test of the coronavirus pandemic.

Prices at 1213 GMT Last Change Pct Move CBOT wheat 819.75 1.50 0.18 CBOT corn 665.25 1.75 0.26 CBOT soy 1437.25 0.50 0.03 Paris wheat 337.50 6.75 2.04 Paris maize 307.50 0.75 0.24 Paris rapeseed 601.25 -1.75 -0.29 WTI crude oil 81.14 1.10 1.37 Euro/dlr 1.0263 0.00 0.21 Most active contracts - Wheat, corn and soy US cents/bushel, Paris futures in euros per tonne.

(Reporting by Naveen Thukralin Singapore and Sybille de La Hamaide in Paris; Editing by Rashmi Aich, Kirsten Donovan)

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