Wheat dips after fund-buying rally; corn and soy also lower

PARIS/SINGAPORE: Chicago wheat futures eased on Thursday as the market took a breather after its biggest one-day rally in a month, with grain markets looking ahead to weekly US export figures for a fresh indication of demand.
Corn and soybeans also edged lower after rising sharply on Wednesday, with large global inventories and a favorable outlook for South America crops capping gains.
The Chicago Board of Trade’s most-active wheat contract gave up 0.7 percent to $4.30-1/2 a bushel by 1125 GMT after Wednesday’s 3 percent rise, the biggest since Dec. 27. Soybeans fell by 0.3 percent to $10.34 a bushel and corn lost 0.3 percent to $3.67 a bushel.
“Cereals found support with the buying stance from funds on both wheat and corn and the decline of the dollar,” consultancy Agritel said in a note. Commodity funds were net buyers of CBOT corn, wheat and soybean futures on Wednesday.
Estimates of net fund buying in corn ranged from 8,000 to 20,000 contracts, in wheat from 4,000 to 14,000 and in soybeans from 4,000 to 10,000. However, ample global supply and worries about potential trade disputes between the new US government and major export clients such as Mexico have tempered price sentiment.
Grain markets will receive another indication of demand from weekly US export sales data due at 1330 GMT. Signs of export demand helped soybeans to rally on Wednesday, suggesting a recent fallback in prices had stirred interest.
For wheat, analysts were playing down the likely impact of winter weather on northern hemisphere crops.
“Four years of surpluses still exert pressure on wheat prices. And all the signs have so far pointed to another high global wheat harvest in 2017/18,” Commerzbank analysts said in a note. Soybeans, which climbed to a six-month high last month, are coming under pressure as weather improves in Argentina, while harvesting in Brazil is on track for a record crop of more than 100 million tons.