Chicago | Reuters — Chicago wheat futures climbed on Friday, gaining for a second consecutive week as frigid temperatures threaten winter wheat crops across the U.S. Plains and into the Midwest.
Fresh export activity in soybeans and corn added support, though gains were limited by much-needed rainfall in Argentina that will boost the rival export nation’s crop potential.
U.S. grain markets will be closed on Monday for the Christmas holiday, reopening at 8:30 a.m. CT on Tuesday.
The most-active wheat contract on the Chicago Board of Trade (CBOT) added 13-3/4 cents to settle at $7.76 a bushel, notching a 2.99 per cent weekly gain, the best week for a most-active contract since the week ended Sept. 30 (all figures US$).
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The most-active CBOT soybean contract lifted 12-1/2 cents to settle at $14.84-1/2 a bushel, gaining 0.3 per cent for the week.
Corn firmed 5-3/4 cents to $6.66-1/4 a bushel, adding two per cent on the week.
Snow, strong winds and temperatures well below freezing have threatened dormant hard red winter wheat crops across the U.S. Great Plains, especially where a lack of snow cover leaves the plants vulnerable to the cold.
The threat of winterkill, combined with already poor conditions after a dry fall, will likely erode yield next spring, said Bill Lapp, ag economist at Advanced Economic Solutions.
“It’s hard to recover from this deep of a decline in conditions and get back to trend,” said Lapp. “We don’t know what we’ve got, or how bad it can be.”
Soybeans found renewed interest after private exporters sold 124,000 tonnes of soybeans to unknown destinations for delivery in the 2022-23 marketing year, the U.S. Department of Agriculture said.
Exporters also sold 150,000 tonnes of corn to Mexico for delivery in the 2022-23 marketing year.
Gains were capped as abundant rains are expected to fall in Argentina, bringing relief to parched farmland in the coming days, the Buenos Aires Grain Exchange said.
“I think the dryness in Argentina is keeping people on their toes a little bit, but maybe that’s in a little better situation than we were a week ago,” said Andrew Jackson, Southeast cash grain trader with Action Ag.
The lack of rainfall in Argentina, the world’s largest exporter of soybean oil and soymeal and the third-largest exporter of corn, is slowing the planting of the current soybean crop and has slashed forecasts for the country’s wheat harvest.
China is expected to end the year with historically low soymeal carryover stocks, which should increase dependence on imported soybeans in 2023, Victor Martins, senior risk manager at HedgePoint Global Markets, said Thursday.
— Reporting for Reuters by Christopher Walljasper in Chicago; additional reporting by Nigel Hunt in London.
