By Kirk Maltais

-Wheat for July delivery rose 2.4% to $6.01 3/4 a bushel, on the Chicago Board of Trade on Tuesday, with the continuous contract closing above the $6 a bushel mark for the first time since February on weather concerns and a stronger U.S. dollar.

-Corn for July delivery rose 0.6% to $4.52 1/2 a bushel.

-Soybeans for July delivery rose 0.4% to $11.81 a bushel.


Rising Force: Short-covering is seen as the primary driver behind higher grain futures - with a lower U.S. dollar providing a boost to all commodities. "The U.S. dollar is dropping and energies are rallying and this is bringing buyers to all commodities today," said Karl Setzer of Consus Ag Consulting. "The short covering is mainly from bear traders running out of reason to hold short positions." Rainfall is forecast in the Corn Belt this weekend, which has farmers in their fields this week hurrying to get seeding work done before the weekend hits, and soils get too wet to plant in.

Weaker Wheat: The latest Crop Progress report from the USDA showed a 5-point drop in winter wheat conditions to 50% good-to-excellent. The slide signals that drought is hurting winter wheat in the Southern Plains, and was an early source of support for wheat futures. "In the U.S., areas of Western Kansas along with OK and TX panhandles continue to miss out on rain, deepening drought conditions in that region," said Naomi Blohm of Total Farm Marketing in a note. Unfriendly weather is also hurting crops in other regions, such as France and Russia.


Mitigated Damages: A worsening of the condition of the U.S. winter wheat crop created an only-small impact on futures because, while it shows the effects of drought, 50% of the crop still falls under the good-to-excellent banner. "Crops are in much better shape than last year," said Commerzbank in a note. "There is also a larger area of winter wheat. In this respect, the current situation is hardly dramatic."

Higher Traffic: The fast-paced growth of the Brazilian agricultural sector can be seen in data from state crop agency Conab showing a 780% uptick in grain shipments via waterway from 2010. Conab says that Brazil has 253 private use terminals, with another 247 terminals for public use. "Given the growth of the Brazilian harvest, greater integration between modes tends to make the grains produced by Brazilian farmers more competitive on the international market," according to Conab in a note.


-Ethanol producer Valero Energy will release its fiscal first-quarter earnings at 6:30 a.m. ET Thursday.

-The USDA will release its weekly export sales report at 8:30 a.m. ET Thursday.

-The USDA will release its monthly Livestock Slaughter report at 3 p.m. ET Thursday.

Write to Kirk Maltais at

(END) Dow Jones Newswires

04-23-24 1515ET