SINGAPORE- Chicago wheat futures rose for a second session on Thursday to hit a three-month high, with short-covering by funds and cold weather in the US grain belt underpinning the market.
Soybeans edged higher for the first time in three sessions, although gains were checked as traders waited for more clarity on US-China trade negotiations.
The most-active wheat contract on the Chicago Board Of Trade added 0.3 percent at $5.15 a bushel by 0253 GMT, after climbing to its highest since July 19 at $5.16-1/2 a bushel.
Soybeans were up 0.2 percent at $9.30 a bushel, having closed down 0.6 percent on Wednesday and corn gained 0.1 percent at $3.92-1/4 a bushel, having closed down 0.4 percent in the previous session.
“The wheat market is well supplied but there is some short-covering and threat to supplies from US weather,” said Phin Ziebell, agribusiness economist at National Australia Bank.
“We are not yet sure, what is the extent of damage from the cold weather in the United States.”
There is additional support for wheat stemming from news that Egypt bought 405,000 tons of Russian, French and Ukrainian wheat, at higher prices than what it paid at its last international tender on Oct. 8.
Commodity funds were net sellers of CBOT soybean, corn and soymeal futures contracts on Wednesday and net buyers of wheat and soyoil futures, traders said.
Traders are looking for fresh Chinese demand for US agricultural products.
US President Donald Trump said last week that China had agreed to purchase $40 billion to $50 billion worth of US agricultural goods in a first phase of an agreement to end a 15-month trade war.
But China would make the purchases only if Trump rolls back levies put in place since the trade war began, Bloomberg reported on Tuesday, citing people familiar with the matter.
The US Department of Agriculture (USDA) late on Tuesday said the US corn harvest was 22 percent complete and the soybean harvest was 26 percent complete.
The agency will collect additional information on harvested acreage of corn and soybeans in Minnesota and North Dakota following recent snowfall in both states, the government said in a statement on Wednesday.
Ukraine has increased its grain exports by around 39 percent to 15.44 million tons so far in the 2019/20 July-June season thanks to higher wheat shipments, Ukraine’s agriculture ministry said on Wednesday. – Reuters