Wheat gained on mounting signs that global demand is improving after prices tumbled last month to a four-year low. Corn advanced as dry, hot weather reduced U.S. yield potential. Soybeans fell.
Sales of U.S. wheat in the past three months surged 38 percent from last year, and export licenses issued by the 28-nation EU more than doubled, government data show. World inventories will drop to a five-year low by June 30 even as farmers harvest a record crop, the U.S. Department of Agriculture said Aug. 12. U.S. soft, red winter wheat in cash markets is 31 percent cheaper than a year ago, data from the Minneapolis Grain Exchange show.
“The wheat market is responding to the improving global export trade,” Greg Grow, the director of agribusiness at Archer Financial Services Inc. in Chicago, said in a telephone interview. “We are seeing a lot of the extra wheat supplies getting scooped up by countries looking to rebuild food reserves.”
Wheat futures for delivery in December gained 1 percent to $6.475 a bushel at 10:42 a.m. on the Chicago Board of Trade. The grain, last year’s best-performing commodity, has tumbled 17 percent this year.
Corn rose in Chicago on speculation that hot, dry Midwest weather the past month expanded drought conditions, reducing U.S. production, Grow said.
About 54 percent of the corn crop was rated good or excellent on Sept. 8, down from 56 percent a week earlier and 64 percent a month ago, the USDA said yesterday. About 52 percent of the U.S. soybean crop was rated in good or excellent condition, compared with 54 percent a week earlier and 64 percent on Aug. 11, the agency said.
Corn futures for December delivery added 0.7 percent to $4.6675 a bushel in Chicago, erasing a drop of 0.6 percent. The grain declined 34 percent this year through yesterday.
Soybean futures for November delivery slid 0.2 percent to $13.5425 a bushel on the CBOT.
Corn is the biggest U.S. crop, followed by soybeans, hay and wheat, USDA data show.
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