June 14, 2017 / 2:47 AM / 2 months ago

GRAINS-Spring wheat set for biggest 2-day rally in 2 years on crop-damage fears

    * Minneapolis Grain Exchange spring wheat up for 2nd day
    * Fears of widespread crop damage in U.S., Canada
    * Corn, soybean prices edge up on back of gains in wheat

 (Adds comment, detail)
    By Naveen Thukral
    SINGAPORE, June 14 (Reuters) - U.S. spring wheat futures
rose 2.2 pct on Wednesday, with the market poised for its
biggest two-day rally in as many years on concerns over dry
weather hitting yields in the United States and Canada.
    Spring wheat traded on the Minneapolis Grain Exchange
 has risen almost 7 percent since Tuesday, the biggest
two-day rise since June 2015.
    Gains in high-protein spring wheat pushed Chicago wheat
, corn and soybeans higher.
    "North American spring wheat remains the epicentre of the
action," said Tobin Gorey, director of agricultural strategy at
Commonwealth Bank of Australia in Sydney.
    "Rainfall, recent and expected soon, is only enough to be a
balm rather than a cure."
    The U.S. Department of Agriculture assessed the spring wheat
crop at 45 percent good-to-excellent as of June 4, down 10
percentage points from a week earlier. Analysts had been
expecting a good-to-excellent rating of 53 percent.

    High-protein wheat prices being offered from Australia and
the United States into Asia are climbing as the dry weather
threatens to reduce the U.S. harvest, traders said on Tuesday.
    Australian prices, some of the most competitive in recent
months, have also been supported by farmers holding back
supplies.
    Still, Australia slightly raised its forecast for 2017/18
wheat production on Wednesday as favourable weather along the
country's east coast looks set to boost output from the world's
No. 4 exporter.
    Australian wheat production is expected to total 24.19
million tonnes, the Australian Bureau of Agriculture, Resource
Economics and Rural Sciences (ABARES) said, up nearly 1 percent
from its March forecast of 23.98 million tonnes.
    The USDA rated soybean crop as 66 percent good-to-excellent,
compared with forecasts for 69 percent. U.S. corn was at 67
percent good-to-excellent, matching analyst forecasts.
    The National Oilseed Processors Association's May soybean
crush was forecast to fall 6 percent below the 2016 level, with
U.S. processors slowing their pace amid abundant South American
supplies.
    Analysts were expecting a May crush of 143.192 million
bushels, according to the average of six estimates given in a
Reuters poll. A year ago, NOPA reported a May crush of 152.280
million bushels.
    
 Grains prices at  0217 GMT
 Contract    Last    Change  Pct chg  Two-day chg  MA 30   RSI
 CBOT wheat  447.00  2.00    +0.45%   +0.28%       435.11  62
 CBOT corn   382.50  1.50    +0.39%   -1.35%       372.87  59
 CBOT soy    935.00  2.50    +0.27%   -0.69%       948.26  52
 CBOT rice   11.26   $0.00   +0.04%   -0.53%       $10.74  68
 WTI crude   45.99   -$0.47  -1.01%   -0.20%       $47.96  37
 Currencies                                                
 Euro/dlr    $1.122  $0.003  +0.22%   +0.04%               
 USD/AUD     0.7538  0.001   +0.16%   -0.05%               
 Most active contracts
 Wheat, corn and soy US cents/bushel. Rice: USD per
 hundredweight
 RSI 14, exponential
         

 (Reporting by Naveen Thukral; Editing by Joseph Radford)
  

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