Supply fears hold wheat near 3-month highs

By Reuters

Chicago wheat futures dipped from three-month highs on Monday but were supported by concerns over crop production in Europe and escalating tensions between Russia and Ukraine that could impact exports.

Corn and soybean futures also fell as the United States geared up for large harvests of both crops.

FUNDAMENTALS

* The most-active wheat contract on the Chicago Board of Trade (CBOT) was down 0.3% at $5.93 a bushel by 0026 GMT after touching $5.99 on Friday, the highest since June 19.

* CBOT corn slipped 0.7% to $4.10-1/2 a bushel and soybeans fell 0.3% to $10.03 a bushel.

* Wheat prices have risen by around 13% in the last three weeks, helped in part by a weak dollar that has made U.S. farm goods cheaper for overseas buyers.

* Moscow declined to comment after Ukraine last week accused it of striking a grain vessel with a missile.

* Russia is the world’s top wheat exporter and Ukraine is a major supplier. The ship attack added to doubts about Black Sea supply after adverse weather hit crops in the region.

* Strategie Grains and the U.S. Department of Agriculture again cut their forecasts for European Union soft wheat production after too-heavy rains hit some cropping regions.

* “Europe’s crop could still see another 4-6 million metric tons in reductions going forward – some would say more – while the size and quality of the Russian crop could also see more downward revisions,” StoneX analyst Arlan Suderman wrote in a note.

This article has been republished from The Livemint.