Wheat futures rose due to strong global demand for US supplies as well as concerns about potential damage to the developing crop in the US Plains from forecasts for a turn to colder weather.
Corn futures edged higher as wet weather in key growing areas across the US Midwest threatened to delay the start of planting this week in places such as Illinois and Iowa.
All three commodities benefited from short covering as prices have fallen sharply during the past two weeks. “More than anything, it was just short covering,” said Karl Setzer, market analyst for MaxYield Co-operative. “We really kind of pounded the grains last week. We have ever since we came out with the (quarterly) stocks report.”
Chicago Board of Trade May soft red winter wheat futures ended 13-1/2 cents higher at $7.12-1/2 a bushel. Prices rose through resistance at the 30-day moving average early in Monday’s session, the first time prices surpassed that benchmark since the US Agriculture Department’s bearish quarterly stocks report on March 28.
Hard red winter wheat futures at the Kansas City Board of Trade and MGEX spring wheat also posted strong gains. China bought 14 to 16 cargoes of US wheat on Thursday for delivery from June to December, the China National Grain and Oils Information Center, an official think tank, said on Monday. The announcement confirmed rumours that supported wheat prices last week.
“China’s wheat purchase and ongoing US/global crop concerns have the wheat complex supported across the board,” Matt Zeller, director of research at INTL FCStone, said in a research note to clients.
CBOT May soyabeans were 16-1/4 cents higher at $13.78 a bushel. Traders noted some technical buyers entered the market when prices fell near the low end of their 20-day Bollinger range of $13.54-1/4 a bushel during the overnight session. CBOT May corn was 4-1/2 cents higher at $6.33-1/2 a bushel, lagging the gains in soyabeans and wheat due to the unexpected abundance of supplies reported by the USDA in the quarterly stocks report.