U.S. grains: Wheat, corn futures hit 7-1/2-month highs

Chicago | Reuters — U.S. wheat futures rallied for the fifth day in a row on Monday, hitting a 7-1/2-month high as investment funds continue to add the grain to their portfolio despite ample global supplies.

Corn futures also firmed on a technical bounce and signs of strong demand for U.S. supplies.

But soybeans eased, weighed down by improving conditions for growth in South America that fuelled expectations for a massive harvest in key exporters Argentina and Brazil.

Chicago Board of Trade March soft red winter wheat futures settled up 3-1/4 cents at $4.52-1/4 a bushel, consolidating after hitting a seven-month high last week (all figures US$). The most-active contract hit hits highest since June 29.

Wheat’s five-session winning streak was the longest in two months.

The Australian Bureau of Agriculture, Resource Economics and Rural Sciences said the country’s 2016-17 wheat harvest was a record 35.13 million tonnes.

CBOT March corn gained one cent to $3.75-1/2 a bushel. Corn futures peaked at $3.76-3/4 a bushel, their highest since June 30.

The U.S. Agriculture Department on Monday morning reported weekly corn export inspections of 1.256 million tonnes, up from 1.124 million tonnes a week ago. The weekly total topped trade forecasts for 900,000 to 1.1 million tonnes.

USDA also said private exporters reported a flash sale of 101,600 tonnes of corn to unknown destinations for delivery during the 2016-17 marketing year.

Gains were kept in check by plentiful stocks, both domestically and globally.

“Balance sheets remain heavy, particularly among the main exporting countries, and that there is no major concern for the 2017 crops for the moment,” French consultancy Agritel said in a note.

CBOT March soybean futures settled down 4-3/4 cents at $10.54-1/4 a bushel. The most active contract hit its highest since Jan. 24 during the session.

“Local estimates from Brazil continue to come in higher than USDA, and weather in Argentina appears to be improving, too. Most of the growing region was dry over the weekend, and forecasts do not show the threat of widespread heavy rains that could cause flooding,” Farm Futures senior analyst Bryce Knorr said in a note to clients.

Brazil’s Abiove said it expected local soybean production would hit 104.6 million tonnes, up from its December forecast of 101.7 million. It pegged the country’s soybean exports at 58.7 million tonnes.

— Mark Weinraub is a Reuters correspondent covering grain markets from Chicago. Additional reporting for Reuters by Naveen Thukral in Singapore and Sybille de La Hamaide in Paris.

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