U.S. grains: Wheat hits one-month top on technical buying

Chicago | Reuters — Chicago wheat futures posted a one-month high Thursday on technically driven trade while U.S. soybean and corn futures eked out modest advances as traders waited for the harvest to expand in the Midwest.

Chicago Board of Trade December what settled up 2-3/4 cents at $4.52-1/2 per bushel after reaching $4.54-1/2, its highest since Aug. 16 (all figures US$).

CBOT November soybeans ended up 3/4 cent at $9.70-3/4 a bushel and December corn rose 1/4 cent to $3.50-1/4 a bushel.

Benchmark December CBOT wheat struggled to climb much above $4.50 a bushel this week, anchored by plentiful global supplies, including a record-large Russian harvest.

However, excessive rains in Argentina have threatened wheat yield prospects, while Australia’s crop has suffered from persistent dryness in the east.

Commodity funds hold a large net short position in CBOT wheat futures, leaving the market vulnerable to bouts of short-covering.

Traders were mindful of a U.S. Department of Agriculture Sept. 29 small grains report, in which the government will update its estimates of the U.S. 2017 wheat harvest.

“It is likely that USDA finally adjusts their harvested acreage number for spring wheat. We know there was a very significant amount of abandonment because of drought,” said Joe Vaclavik, president of Standard Grain, a Chicago brokerage.

December spring wheat futures on the Minneapolis Grain Exchange December rose 2-3/4 cents to $6.24-1/4 per bushel, rebounding a day after posting a three-month low of $6.14-1/2.

Spot MGEX futures had soared above $8 a bushel in early July on worries about scorching heat and drought in the northern U.S. Plains crop belt, but have declined sharply since then.

CBOT soybean futures firmed, supported by a larger-than-expected weekly export sales tally. USDA reported export sales of U.S. soybeans in the latest week at more than 2.3 million tonnes, topping a range of trade estimates for 1.2 million to 1.5 million.

Also, through its daily reporting system, USDA said private exporters sold 132,000 tonnes of U.S. soybeans to China.

However, the pace of U.S. soybean sales is still slower than a year ago.

“USDA has set the bar very high for new-crop exports. We’ve got to continue to see this sort of demand, if we are going to hit that USDA export target,” Vaclavik said.

— Julie Imgwersen is a commodities correspondent for Reuters in Chicago; additional reporting by Naveen Thukral in Singapore and Gus Trompiz in Paris.

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