January 7, 2014 / 3:57 AM / 4 years ago

GRAINS-Wheat rises for 3rd day on U.S. weather; corn falls

4 Min Read

* Wheat up as freezing U.S. weather threatens crop
    * Soybeans, corn ease ahead of U.S. stocks report

 (Adds comment, detail)
    By Naveen Thukral
    SINGAPORE, Jan 7 (Reuters) - Chicago wheat edged higher on
Tuesday to hover around a two-week high as freezing weather
across the U.S. grain belt threatens the dormant winter crop.
    Corn edged lower after two consecutive sessions of gains,
and soybeans gave up Monday's advance, which was driven by
expectations the cold weather would prompt higher feed grain
demand in the United States.
    Investors in the agricultural markets are positioning ahead
of the U.S. Department of Agriculture's monthly supply-demand
and quarterly stocks report due on Friday.
    "The threat of winterkill to the U.S. wheat crop has been
mostly priced in," said one Melbourne-based trader. "The next
big thing is quarterly stocks numbers and WASDE (World
Agriculture Supply and Demand Estimates), that is what we are
going to be focusing on."
    The USDA is set to update its estimates for global grain
supply and demand, and to issue its final U.S. crop production
forecasts for the 2013/14 marketing season.
    Many analysts expect the USDA to raise its estimates for
U.S. corn and soybean production and for global corn and soy
inventories.  
    Chicago Board of Trade March wheat had climbed 0.3
percent to $6.07-1/4 a bushel by 0328 GMT, just below Monday's
peak of $6.12-3/4 a bushel, the highest since Dec. 23.
    March corn fell 0.2 percent to $4.26-3/4 a bushel and
March soybeans lost 0.7 percent to $12.68 a bushel.
    An arctic blast pushed morning lows to -4 to -10 degrees
Fahrenheit (-20 to -23 Celsius) in the top wheat state of
Kansas, while Nebraska and Colorado had morning lows in the -12
to -20 F range, MDA Weather Services forecaster Don Keeney told
Reuters.
    Cold weather can damage dormant wheat and boost demand for
livestock feed as animals eat more to generate energy to keep
warm.
    The coldest weather to hit the central U.S. in two decades
has also disrupted grain and livestock shipments throughout the
nation's farm belt.
    On Monday, additional support for corn futures stemmed from
concerns about Argentina's harvest after front-month March corn
fell to a contract low late last week.
    Argentina's recently planted corn and soy crops will be
tested by a heat wave in the days ahead until rains hit the
Pampas farm belt late in the week, a local meteorologist said.
 
    The country is the world's No. 3 exporter of corn and
soybeans and the biggest supplier of soyoil and soymeal.
    The corn market has recently been under pressure from rising
global supplies and the cancellation of U.S. corn purchases by
China.
    A report on Monday by the official Xinhua news agency
suggested that more U.S. corn cargoes than previously thought
had been turned away by China, traders said. 
    
  Grains prices at 0328 GMT
  Contract        Last    Change  Pct chg  Two-day chg MA 30   RSI 
  CBOT wheat     607.25     1.50  +0.25%    +1.72%     632.38   44
  CBOT corn      426.75    -1.00  -0.23%    +1.49%     429.32   50
  CBOT soy      1268.00    -8.75  -0.69%    -0.16%    1309.43   33
  CBOT rice      $15.61   -$0.03  -0.19%    +0.61%     $15.49   68
  WTI crude      $93.68    $0.25  +0.27%    -0.30%     $96.66   26
  Currencies                                                
  Euro/dlr       $1.363   $0.004  +0.28%    -0.33%
  USD/AUD         0.894    0.000  -0.01%    +0.42%
  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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