By Kirk Maltais


--Wheat for March delivery rose 2.8%, to $7.49 1/2 a bushel, on the Chicago Board of Trade on Wednesday, with traders taking the opportunity to jump back into wheat after the contract closed at its lowest in over a year yesterday.

--Soybeans for January delivery rose 1.3% to $14.73 1/2 a bushel.

--Corn for March delivery rose 0.8% to $6.42 1/4 a bushel.


HIGHLIGHTS


Source of Momentum: Across the board, grain futures on the CBOT got a boost in the trading session from China's moves to ease its strict Covid-19 policies, stirring hopes that it will soon fully reopen its economy. "The momentum is clearly in that direction, and it would be very difficult to go backward at this point," said Arlan Suderman of StoneX in a note. "We should see a resumption of demand for commodities in 2023 as China's economy starts to recover."

Taking the Opportunity: For wheat in particular, today proved to be a prime opportunity for traders to jump back into the market, this after four consecutive lower sessions. "Wheat bounced strongly after the recent trouncing on the charts," says Charlie Sernatinger of Marex in a note. Yesterday, wheat futures closed at their lowest level since October 2021.


INSIGHTS


Offsetting Factors: For soybeans, dryness in Argentina has been a factor supporting higher prices this week. However, the situation in Brazil is considerably friendlier - and may put the brakes on the recent momentum. "[We doubt] that CBOT soy futures are moving into a new sustained bullish price trend as Brazil's favorable weather more than offsets any supply loss in Argentina," said AgResource in a note. The firm adds that rainfall in Brazil is seen as continuing to be above normal, while temperatures are near to below normal, which is supporting crops there.

Soaring Stats: Daily production of ethanol in the U.S. shot up in the past week, well past the expectations of analysts. In its latest report, the U.S. Energy Information Administration said daily production of U.S. ethanol rose to 1.077 million barrels a day for the week ended December 2. The output is well up from 1.018 million barrels per day reported last week. Analysts surveyed by Dow Jones forecast daily production would land between 1 million barrels and 1.04 million barrels a day. Daily production is now 1.2% lower than it was at this time last year. Meanwhile, ethanol inventories also rose - climbing 323,000 barrels from last week's projection to 23.26 million barrels.


AHEAD


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

--The USDA will release its monthly world supply and demand report at noon ET Friday.

--The CFTC will release its weekly commitment of traders report at 3:30 p.m. ET Friday.


Write to Kirk Maltais at kirk.maltais@wsj.com


(END) Dow Jones Newswires

12-07-22 1514ET