Chicago | Reuters — U.S. spring wheat futures set fresh 2-1/2-year highs on Tuesday as a further decline in spring wheat condition ratings surprised traders and coincided with concern about damage to French wheat from a heat wave.
But corn and soybean futures fell on improving U.S. crop weather, coupled with broad weakness in other commodities including crude oil. The 19-market Thomson Reuters CoreCommodity CRB Index was down about 1 percent and hit its lowest since April 2016.
Chicago Board of Trade July wheat settled up 5-1/2 cents at $4.72-1/2 a bushel and Minneapolis Grain Exchange (MGEX) July spring wheat ended up 16-3/4 cents at $6.56-1/4 after reaching $6.57, the highest spot price on a continuous chart since December 2014 (all figures US$).
CBOT July corn fell 5-1/4 cents to close at $3.70 a bushel after dipping to $3.69-1/4, its lowest since June 1. July soybeans fell 10 cents at $9.27-3/4 a bushel.
Spring wheat surged after the U.S. Department of Agriculture late on Monday rated 41 per cent of the U.S. spring wheat crop as good to excellent, down from 45 per cent a week earlier. Analysts surveyed by Reuters had expected an improvement.
“Wheat is taking the majority of its support from… the damage that has been done to the spring wheat crop and concerns that the production will be a little bit shorter than what was initially thought,” said Karl Setzer, analyst with Iowa-based MaxYield Cooperative.
Additional support stemmed from concerns about a heat wave damaging crops in France. But December milling wheat on the Paris-based Euronext exchange closed lower as traders booked profits after prices hit their highest in nearly a year.
CBOT corn and soybeans sagged on improving weather in the Midwest crop belt, despite weekly USDA crop ratings that fell just below trade expectations.
“There is nothing threatening in the forecast. Right now, the path of least resistance is lower,” said Tom Fritz, a partner with EFG Group in Chicago.
USDA late Monday rated 67 per cent of the U.S. corn and soybean crops in good to excellent condition. The corn figure was steady with the previous week while the soybean figure was up one percentage point.
— Julie Ingwersen is a commodities correspondent for Reuters in Chicago. Additional reporting for Reuters by Renita Young in Chicago, Naveen Thukral in Singapore and Gus Trompiz in Paris.