April 3, 2018 / 1:38 AM / 3 months ago

GRAINS-Wheat rallies after USDA confirms damage from recent dry weather

    SYDNEY, April 3 (Reuters) - U.S. wheat futures rose more than 0.5 percent on
Tuesday after the U.S. Department of Agriculture said the crop condition has
suffered from recent dry weather, threatening output from the world's largest
exporter.
         
    FUNDAMENTALS  
    * The most active wheat futures on the Chicago Board Of Trade were up
0.7 percent at $4.49-1/2 a bushel by 0047 GMT, having closed down 1 percent on
Monday.
    * The most active soybean futures were up 0.2 percent at $10.19-3/4 a
bushel, after closing down 0.9 percent on Monday when prices hit a high of
$10.60-1/2 a bushel - the highest since March 9.
    * The most active corn futures gained 0.2 percent to $3.88 a bushel,
having closed down 0.1 percent in the previous session.
    * The USDA said 32 percent of the U.S. winter wheat crop was in good to
excellent condition, compared with 51 percent this time last year.
    * The USDA on Thursday forecast U.S. plantings of both corn and soybeans
below trade expectations, sending futures soaring ahead of the long Easter
holiday weekend. The agency also estimated quarterly U.S. stocks of both
commodities at historic highs, which the market largely shrugged off.

    * Fears of a trade war with China, a top agricultural products buyer, kept
markets on edge after Beijing announced higher tariffs on a long list of U.S.
goods, including pork and ethanol.
         
    MARKET NEWS  
    * The dollar fell on Monday, dropping versus the yen for a third straight
session, as China imposed extra tariffs on U.S. products, escalating a dispute
between two of the world's biggest economies.  
    * Oil prices inched up on Tuesday as rising Russian output and expectations
of a reduction in Saudi Arabian crude prices were offset by a potential slowdown
in U.S. production.  
    * Wall Street shares plunged on Monday as investors fled technology stocks
amid resurgent trade war worries, with key indexes trading below their 200-day
moving averages and the S&P 500 closing below that pivotal technical level for
the first time since Britain's vote to leave the European Union in June 2016.
  
    
    DATA AHEAD (GMT)
0600  Germany           Retail sales                       Feb
0750  France            Markit manufacturing PMI           Mar
0755  Germany           Markit/BME manufacturing PMI       Mar
0800  Euro zone         Markit manufacturing PMI final     Mar
1345  U.S.              ISM-New York index    
      
 Grains prices at  0105 GMT
 Contract        Last  Change  Pct chg  Two-day chg    MA 30  RSI
 CBOT wheat    449.50    3.25   +0.73%       -0.33%   473.22   42
 CBOT corn     388.00    0.75   +0.19%       +0.06%   381.72   72
 CBOT soy     1041.25    5.75   +0.56%       -0.34%  1044.00   58
 CBOT rice      12.31   $0.00   +0.00%       -1.08%   $12.34   50
 WTI crude      63.17   $0.16   +0.25%       -2.73%   $62.76   46
 Currencies                                                      
 Euro/dlr      $1.230  $0.000   +0.02%       -0.15%              
 USD/AUD       0.7669   0.001   +0.09%       -0.12%              
 Most active contracts
 Wheat, corn and soy US cents/bushel. Rice: USD per hundredweight
 RSI 14, exponential
 
 (Reporting by Colin Packham; Editing by Subhranshu Sahu)
  
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