US corn futures rose 1.6 percent on Tuesday as traders unwound bearish bets on the market ahead of a key government supply report, traders said. Soyabean futures also rose in pre-report positioning while wheat declined as traders locked in profits from recent gains due to improving crop conditions.
Corn’s gains were their biggest in a month and the market received additional support from planting delays in the US Midwest as well as talk of burgeoning demand from China.
“It is just technical rebound after hitting a multi-month low on Friday,” said Terry Reilly, senior commodity analyst at Futures International. “You are seeing a little bit of short covering from the new shorts that entered the market after the grain stocks report.” At 10:12 am CDT (1512 GMT), Chicago Board of Trade May corn futures were up 9-1/2 cents at $6.43 a bushel, their second straight day of gains.
Improving ethanol margins also helped boost corn futures, said Austin Damiani, a broker for Frontier Futures.
CBOT May soyabeans were up 7-1/4 cents at $13.85-1/4 a bushel while CBOT May wheat shed 3-3/4 cents to $7.08-3/4 a bushel. The contract had risen 7.3 percent in the past week before Tuesday’s drop.
US winter wheat condition ratings improved in the latest week but hovered at the lowest level for this time of year since 2002, the US Department of Agriculture’s weekly crop progress report showed.
The USDA said 36 percent of the US winter wheat crop was rated in good to excellent condition, up from 34 percent a week earlier.