Markets > Futures

U.S. crop futures gain weekly on fund buying, trade optimism

CHICAGO
2019-03-17 05:38

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CHICAGO, March 16 (Xinhua) -- Chicago Board of Trade (CBOT) crop futures traded sharply higher in the trading week ending on March 15, boosted by massive buying, adverse weather and China trade optimism.

The most active corn for May delivery was up 9 cents, or 2.47 percent weekly, to settle at 3.7325 dollars per bushel. May wheat was up 22.75 cents, or 5.18 percent, to close at 4.6225 dollars. March soybeans were up 13.5 cents, or 1.51 percent, to settle at 9.0925 dollar per bushel.

CBOT soybeans marked an early week low but turned higher toward Friday's close.

On Monday, the U.S. Department of Agriculture confirmed export sales of 926,000 metric tons of soybeans for delivery to China during the 2018/19 marketing year, following another recent booking of 664,000 metric tons by China, the world's top soybean buyer. But the news failed to boost soybean prices immediately.

The USDA on Tuesday released its export inspections report for the week ending March 7, showing increase in soybean inspections, from previous week's 848,357 metric tons to 874,363 metric tons, also a bullish development which enabled CBOT soybeans to trade in the positive territory.

During Friday's session, Chicago soybeans rose 1.2 percent further, back above the 9-dollar-per-bushel level again over latest reports which indicated further "substantial progress" on U.S.-China trade talks.

Corn futures also posted significant gains this week due to short covering and adverse weather, amid concerns that the flooding impacting Iowa and several other Midwest states may lead to possible delay of seeding.

Lasting dryness is needed for planting, but it seems unlikely across the North Plains and Midwest through April, said market watchers.

Heavy rain and rapidly melting snow have already resulted in floods that hit Iowa, Wisconsin, and Nebraska. In Iowa, governor Kim Reynolds has issued state disaster declarations for 21 counties due to the massive flooding, which threatened residences and industries, and might disrupt field operations as well.

CBOT wheat, after falling to the lowest level since January 2018 amid massive fund selling, rebounded more than 5 percent this week on bargain hunting and short covering.

"Wheat is also on the rise as global prices are on the rally and finally we can start to move a little bit higher after the huge sell-off,"said Virginia McGathey, a market analyst with McGathey Commodities.

She added that unfavorable weather can also create logistics problems for wheat, giving additional support to the grain.

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