Chicago | Reuters — Chicago Board of Trade wheat futures soared 6.6 per cent on Friday, extending a rebound from four-month lows this week on easing fears of a global recession and signs of renewed importer demand, analysts said.
Corn also rose to move up from a seven-month low touched this week, and soybeans continued to recover from a six-month low.
“It was all about fear when we were selling,” said Arlan Suderman, chief commodities economist for broker StoneX. “Now the market is seeing a bounce back because it realized it had gone down too far.”
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The most-active wheat contract on the CBOT settled up 55 cents at $8.91-1/2 per bushel and touched its highest price since July 1 (all figures US$). CBOT corn rose 27-1/4 cents to finish at $6.23-1/2, while soybeans gained 31 cents to finish at $13.96-1/2 a bushel.
Commodity funds were net buyers of an estimated 18,500 wheat contracts; 20,000 corn contracts; and 12,000 soybean contracts, traders said.
“Receding macro worries, and what most would regard as too low prices, set the market up for these gains,” said Robin Gore, director of agricultural strategy at the Commonwealth Bank of Australia, of the move in wheat prices.
Traders said there was market chatter about China showing interest in foreign wheat and corn for possible import purchases.
China, the world’s biggest soy importer, and unknown buyers in the week ended June 30 cancelled purchases of about 465,000 tonnes of U.S. soybeans for 2021-22, the U.S. Department of Agriculture said in a weekly export sales report.
“Now that we have had the break in prices, look for China to come in to do some buying for soybeans, as well as for corn and wheat,” Suderman said.
Traders continued to keep an eye on U.S. weather during a critical time of development for corn crops. They also adjusted positions ahead of a monthly U.S. Department of Agriculture supply and demand report due on Tuesday.
— Reporting for Reuters by Tom Polansek in Chicago; additional reporting by Gus Trompiz in Paris and Naveen Thukral in Singapore.
