July 7, 2017 / 1:44 AM / 15 days ago

GRAINS-Wheat retreats further from 2-yr high, but output worries support

4 Min Read

    SYDNEY, July 7 (Reuters) - U.S. wheat fell for a second
consecutive session on Friday to move further away from two-year
highs touched this week, but worries about widespread production
losses continued to offer support.
    
    FUNDAMENTALS  
    * The most active wheat futures on the Chicago Board of
Trade were up nearly 2 percent for the week, set for their
fifth weekly gain.
    * The most active soybean futures were up nearly 5
percent for the week, extending two-week gains to nearly 10
percent.
    * The most active corn futures were up more than 5
percent for the week, the second weekly gain in a row.
    * Forecasts for hot dry weather in key U.S. wheat-growing
regions have sparked worries about widespread production losses.
    * The U.S. Department of Agriculture said on Wednesday
afternoon that good-to-excellent ratings for U.S. spring wheat
dropped 3 percentage points to 37 percent in the latest week,
slightly below market expectations.
    * Good-to-excellent ratings for winter wheat fell 1
percentage point. 
    * The USDA crop progress report showed a 1 percentage point
rise in good-to-excellent ratings for corn to 68 percent,
outperforming an average trade estimate of 66 percent.
    * Private analytics firm Informa Economics on Thursday
projected U.S. 2017 corn production at 14.166 billion bushels
based on an average yield of 169.7 bushels per acre, trade
sources said. That compares with USDA forecasts of 14.065
billion bushels and 170.7 bushels per acre. 
             
    MARKET NEWS  
    * The dollar was steady in early Asian trading on Friday, on
track for weekly gains but likely to tread water throughout the
day as investors braced for monthly U.S. employment data later
in the global session after downbeat jobs figures overnight.
  
    * Oil futures settled up slightly on Thursday, well off
session highs, after a sharp but short-lived boost from a much
bigger-than-expected decline in U.S. inventories of crude oil
and gasoline.  
    * U.S. stocks were sharply lower on Thursday after
disappointing labour market data clashed with the possibility of
a more hawkish Federal Reserve, while rising tensions in the
Korean peninsula providing additional pressure.  
    
    DATA AHEAD (GMT) 
0600  Germany               Industrial output              May 
0645  France                Industrial output              May 
0645  France                Trade balance                  May 
0830  Britain               Industrial output              May 
1230  U.S.                  Nonfarm payrolls               Jun 
1230  U.S.                  Unemployment rate              Jun 
        
 Grains prices at  0114 GMT
 Contract       Last  Change  Pct chg  Two-day chg    MA 30  RSI 
 CBOT wheat   536.25   -2.75   -0.51%       -4.24%   476.75    65
 CBOT corn    401.50   -1.25   -0.31%       -0.68%   395.78    65
 CBOT soy    1001.25    2.00   +0.20%       +0.70%   941.83    83
 CBOT rice     11.91  -$0.02   -0.13%       +0.80%   $11.58    68
 WTI crude     44.84  -$0.68   -1.49%       -0.64%   $45.79    46
 Currencies                                                      
 Euro/dlr     $1.142  $0.000   -0.04%       +0.57%               
 USD/AUD      0.7575  -0.001   -0.13%       -0.33%               
 Most active contracts
 Wheat, corn and soy US cents/bushel. Rice: USD per hundredweight
 RSI 14, exponential
 
 (Reporting by Colin Packham; Editing by Joseph Radford)
  

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