Chicago | Reuters — Chicago Board of Trade wheat futures on Thursday leapt to their highest prices in more than two months as the latest crop estimates in major exporting countries like Argentina, France and Russia raised questions about global supply.
Corn and soybean futures also strengthened, as weather forecasts predicted more heat and dryness in the U.S. Midwest crop belt later this month. Traders adjusted positions in the markets ahead of a monthly supply-and-demand report due from the U.S. Department of Agriculture on Friday.
Analysts expect USDA will trim its estimate for U.S. wheat production in the latest cut to global harvest estimates from crop forecasters around the world. Production forecasts have also declined this week in exporter nations such as Argentina, Russia and France.
“There are a lot of key countries out there that aren’t doing so great,” said Jim Gerlach, president of U.S. broker A/C Trading.
The most actively traded CBOT wheat futures ended up 8-1/2 cents at $5.25 per bushel after reaching $5.31-1/4, the highest price since April 28 (all figures US$).
Most-active CBOT soybean futures were up 4-1/4 cents at $9.01-1/2 a bushel, while corn settled up 2-3/4 cents at $3.57 a bushel.
Forecasts for hot, dry weather in parts of the U.S. Midwest over the next two weeks underpinned the markets as more of the corn crop is entering a key stage of development known as pollination, analysts said. Rain is needed in states like Illinois, Indiana and Ohio to avoid crop stress, they said.
“You’re going to get some scattered amounts this week, but what about next week?” Gerlach said. “The week two forecast is what looks really scary.”
Analysts on average expect USDA on Friday to lower its forecasts for U.S. 2020-21 corn production and ending stocks, according to a Reuters poll.
— Reporting for Reuters by Tom Polansek in Chicago, Gus Trompiz in Paris and Colin Packham in Sydney.