Chicago | Reuters — U.S. corn and soybean futures rallied on Thursday to their highest respective levels in more than a week, supported by forecasts for hot weather that will stress crops in key growing regions, traders said.
Both commodities notched their third straight day of gains. Corn led the sector, rising 2.1 per cent, as much of the crop in the Midwest was entering its key pollination phase of development, when final yields are determined.
“Temperatures will continue to bake the northern Plains and western Corn Belt until the weekend, with triple-digit readings expected in parts of Iowa,” Farm Futures senior analyst Bryce Knorr said in a note to clients.
The strength in corn pulled wheat futures higher. Traders also noted bargain buying in wheat, which had fallen for six sessions in a row, as well as support from better-than-expected export data. The benchmark Chicago Board of Trade September soft red winter wheat contract hit its lowest level since June 29 during overnight trading.
Chicago Board of Trade corn for December delivery settled up 8-1/2 cents at $4.04-3/4 a bushel (all figures US$).
“Corn was strong again on forecasts for hotter and drier, shaking off unexpected rains over the heart of the belt, and some chart buying,” Charlie Sernatinger, global head of grain futures at ED+F Man Capital, said in a note to clients.
CBOT November soybeans were 14-1/2 cents higher at $10.27 a bushel.
Both corn and soybeans peaked at their highest levels since July 12.
Corn crop condition ratings declined earlier this week in top-producing states of Iowa, Illinois and Nebraska, and extended outlooks for limited rainfall were seen as threatening.
“Both corn and soybean crops are now in significantly worse condition than at the same point last year, as well as below the average for the past 28 years,” Commerzbank said in a research note.
CBOT September soft red winter wheat futures ended up 2-3/4 cents cent at $5.05-3/4 a bushel. Kansas City hard red winter wheat and MGEX spring wheat also posted higher closes after trading in negative territory for parts of the session.
The U.S. Department of Agriculture early on Thursday reported weekly wheat export sales of 669,500 tonnes, well above trade forecasts that ranged from 250,000 to 450,000 tonnes.
— Mark Weinraub is a Reuters correspondent covering grain markets from Chicago. Additional reporting for Reuters by Colin Packham in Sydney and Nigel Hunt in London.