Chicago | Reuters — U.S. wheat and soybean futures jumped to multi-year highs on Tuesday, supported by concerns about dry weather in key production areas, traders said.
Corn futures hit their highest level in 8-1/2 months, joining in the rally as the U.S. harvest pace fell below expectations despite ideal weather for field work.
But all three commodities closed off their peaks as traders locked in some profits from the rallies.
The dry conditions in South America could boost already-robust demand for U.S. supplies as farmers in Brazil struggle to plant in the parched soils.
“Delayed planting means delayed harvest, which delays the start of Brazil’s export season,” Arlan Suderman, chief commodities economist for broker StoneX, said in a note. “The first soybeans typically reach the port for shipment to China in January, but that could be delayed by a month, extending the U.S. export season.”
Chicago Board of Trade November soybeans settled up 22-1/2 cents at $10.44 a bushel (all figures US$).
The most-active soybean contract peaked at $10.53-3/4 a bushel, its highest on a continuous basis since May 3, 2018.
A lack of rain in the coming days should further delay Brazil’s planting, consulting firm AgRural said on Monday.
Private exporters reported the sale of 154,400 tonnes of soybeans to unknown destinations, the U.S. Agriculture Department said on Tuesday.
CBOT December soft red winter wheat ended up 8-1/2 cents at $5.92-3/4 a bushel. The most-active contract topped out at $6.01-3/4 a bushel, its highest price since June 30, 2015.
Dryness in Argentina will add stress to the developing wheat crop from that key exporter, forecaster Commodity Weather Group said in a note.
Traders also cited technical buying and short covering in wheat.
CBOT December corn was up 5-1/2 cents at $3.85 a bushel, with the most active contract hitting its highest level since Jan. 24.
— Reporting for Reuters by Mark Weinraub in Chicago; additional reporting by Gus Trompiz in Paris and Naveen Thukral in Singapore.