Chicago | Reuters — U.S. wheat futures rose on Friday, supported by results from an annual crop tour that projected below-average yields in Kansas, the top production state for the grain, traders said.
End-of-week short covering and some bargain buying following a 1.4 per cent decline on Thursday also buoyed prices.
Corn and soybeans firmed slightly, with gains kept in check by expectations that the U.S. Agriculture Department’s crop progress report on Monday afternoon will bolster harvest expectations for both crops.
“Planting progress made great strides up until the rains occurred this week,” said Greg Grow, director of agribusiness at Archer Financial Services in Chicago. “We are well ahead of normal, especially for corn, and summer forecast remains pretty good for potential.”
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Chicago Board of Trade wheat for July delivery settled up 8-3/4 cents at $4.81-1/2 a bushel (all figures US$). For the week, the contract rose 1.8 per cent, snapping a streak of four straight weekly losses for the most actively traded contract.
The winter wheat crop in Kansas should be below average in 2015, reflecting drought, bouts of freezing temperatures and crop diseases, scouts on the Wheat Quality Council’s annual tour found.
Hard red winter wheat production was projected at 288.5 million bushels, above last year’s official U.S. Department of Agriculture output of 246.4 million bushels but below the five-year crop tour average of 313.6 million bushels.
“All in all, the tour members seemed to be somewhat disappointed with the crop, saying that it was better than last year, but not a lot better,” Charlie Sernatinger, global head of grain futures at ED+F Man Capital, said in a note.
Concerns about a turn to colder weather damaging some of the crop in the U.S. Plains provided further support to wheat.
CBOT July soybeans were 1-1/4 cents higher at $9.76-1/4 a bushel, notching a weekly gain of 1.1 per cent. CBOT July corn, which rose 0.3 per cent this week, was up 1-1/2 cents at $3.63 a bushel.
Forecasts of record production in China issued earlier this week continued to weigh on corn prices, which were on track for their third straight weekly loss.
“There is fair bit of corn in China, so the market is trying to price in high stocks in China and what they are going to do to imports over the next 12 months,” said Paul Deane, senior agricultural economist at ANZ Bank.
— Mark Weinraub is a Reuters correspondent covering grain markets from Chicago. Additional reporting for Reuters by Naveen Thukral in Singapore and Nigel Hunt in London.
