Home / MARKET / Wheat, soybean futures reach highest prices

Wheat, soybean futures reach highest prices

Wheat, soybean futures reach highest prices
File Picture

 GFMM desk: U.S. wheat and soybean futures jumped on last December 27 of these highest prices since summer 2018 on expectations for increased Chinese buying as a result of an initial trade deal. Corn futures set an eight-week high.

After countries agreed to a first step deal this month to ease their trade wars, markets began to focus on the potential for more U.S. sales in China. The dispute has led China to reduce shipments of soybeans, sorghum, pork and other agricultural products for more than a year.

Beijing, the world’s largest soybean importer, is increasingly committed to U.S. farm goods as part of a trade agreement, though details have not yet been announced. China has bought about 1 million tons of EU wheat so far this season and can now transfer to US supplies under contract.

‘You’ve got continued rumors that China’s going to buy both corn and wheat,’ said Jim Gerlach, president of broker A/C Trading in Indiana.

The most actively traded wheat futures were up 9-3/4 cents at $5.58-3/4 a bushel at the Chicago Board of Trade by 10:35 a.m. CST (1635 GMT). The contract earlier reached its highest price since August 2018 at $5.61.

Most-active soybeans futures touched the highest price since June 2018 before pulling back. The contact was down 5-1/2 at $9.41 a bushel after reaching a session high of $9.50-1/2.

Corn futures were up 3/4 cent at $3.89-1/4 a bushel and reached their highest price since Nov. 1.

‘The market is getting confident that China is going to make meaningful purchases,’ said Ole Houe, director of advisory services at brokerage IKON Commodities in Sydney.

The U.S. Department of Agriculture in a weekly report said export sales of U.S. wheat last week were 714,900 tons, toward the high end of analysts’ expectations for 200,000 tons to 900,000 tonnes.

Concerns about a decline in global wheat production over adverse weather have helped raise wheat futures, traders said. They also said the product funds would buy wheat futures as the portfolios were balanced for 2020.

‘Concerns of declining world production and lower U.S. acres are driving strength in wheat prices,’ U.S. brokerage CHS Hedging said in a note.

As the prices of palm oil continued to rise, the oilseed markets were supported. Malaysia’s palm oil futures have reached their highest in almost three years, predicting lower yields, along with demand for biofuels.

Source: Online/SZK

Leave a Reply

Your email address will not be published. Required fields are marked *