Soybeans extended gains and corn climbed on speculation that demand is improving as U.S. farmers withhold newly harvested supplies. Wheat also rose.
Exporters reported selling 120,000 metric tons of soybeans for delivery by Aug. 31 to Russia, the U.S. Department of Agriculture said today. Russia purchased 120,000 tons earlier this year. U.S. ethanol production rose 3.2 percent to 897,000 barrels a day in the week ended Oct. 18, the highest since June 2012, the Energy Information Administration said today.
“The Russian purchase was a surprise and underscores improving demand for U.S. soybeans from overseas buyers,” Greg Grow, the director of agribusiness for Archer Financial Services Inc. in Chicago, said in a telephone interview. “The pace of farmer selling is very slow despite big yields, increasing commercial cash bids. U.S. and world corn buyers are caught short of supplies.”
Soybean futures for delivery in January rose 0.5 percent to close at $13.04 a bushel at 1:15 p.m. on the Chicago Board of Trade, after touching $13.1275, the highest since Sept. 30.
Corn futures for delivery in December added 1 percent to $4.4275 a bushel, the biggest gain since Oct. 15. Corn fell 37 percent this year as the U.S. harvest is forecast to jump 28 percent to a record.
Wheat traded near the highest price in four months in Chicago on speculation that South America may seek more U.S. supplies after dry weather.
The worst drought in 50 years in areas of Argentina, South America’s biggest wheat exporter, resulted in “irreversible damage” to the crop and eroded conditions for recently planted corn, researcher Oil World said yesterday. About 20.58 million bushels of U.S. wheat were inspected for export in the week ended Oct. 17, up 25 percent from a year earlier, the Department of Agriculture said.
“South American wheat in general looks pretty poor, not only in Argentina, but in parts of Brazil and Paraguay the situation is pretty bad,” Chris Gadd, an analyst at Macquarie Group Ltd. in London, said by telephone. “The U.S. is going to get an awful lot of demand, and the balance sheet is going to be tight.”
Wheat futures for delivery in December climbed 0.1 percent to $7.0175 a bushel on the CBOT. Prices touched $7.1125 on Oct. 21, the highest since June 21. The grain fell 9.8 percent this year as the USDA estimates global output may rise to a record 708.9 million tons.