By Paulo Trevisani
--Wheat for September delivery rose 2.4% to $7.05 1/4 a bushel on the Chicago Board of Trade on Thursday, following strong weekly exports and continuous forecasts of weather conditions hurting production in key producing countries.
--Corn for December delivery rose 1.4% to $5.56 1/2 a bushel.
--Soybeans for November delivery rose 1.2% to $13.77 3/4 a bushel.
HIGHLIGHTS
New Crop Interest: Grain futures rallied as export data met forecasts of tight supply due to weather conditions unfavorable to crops. "Net cancellations for old crop corn and beans were somewhat offset by new crop sales at the top end of expectations," RCM Alternatives said, noting that "new crop bean sales continue to be historically low as we head into the new marketing year, but that also means there will likely be a bid under the market on any major weakness as importers have some catching up to do."
Flash Sales: The USDA reported flash export sales of 132K metric tons of soybeans to unknown destinations during the 2021-22 marketing year, which begins in September. The news was an added push to grain prices already rising because unfavorable weather is hurting the world's food supply. Earlier, the agency said that exports of old corn and soybean crops had more cancellations than new orders last week, while orders for new crops increased.
INSIGHT
Poor Tour: Wheat rose after the USDA reported 515K metric tons in net export sales for the week ended on June 22, a 9% increase from the previous week and 46% above the prior 4-week average, with China and Mexico as the top buyers. Beyond weekly exports, harsh weather conditions kept hammering crops around the world, in another bullish development for prices. "US wheat is higher on poor results from the US spring wheat crop tour," Futures International says.
Short Shrift: Higher corn and soybean prices are pushing importers to order wheat instead, or Argentine corn, thus the lofty amount of cancellations of US export orders in recent weeks, AgResource says. "Yet, the forward US export outlook is brightening as feed wheat prices continue to rally as exporter milling wheat supplies tighten," and as Brazilian soybeans reach new highs, the research firm said. There were reports of some investors shorting grains, in a bet that weather would cool down and result in higher-than-expected yields. But rallying prices indicate that most bets are on tighter supply.
AHEAD
--The USDA will release its monthly agricultural prices report at 3 p.m. ET Friday.
--The CFTC will release its weekly commitment of traders report at 3:30 p.m. ET Friday.
Write to Paulo Trevisani at paulo.trevisani@wsj.com
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07-29-21 1526ET
