By Kirk Maltais 
 

--Wheat for March delivery rose 3.1% to $8.15 a bushel on the Chicago Board of Trade Thursday, as traders speculate that Russian taxes on exports will leave room for increased demand for U.S. wheat.

--Soybeans for January delivery rose 1.3% to $12.44 1/4 a bushel.

--Corn for March delivery rose 0.9% to $5.76 3/4 a bushel.

HIGHLIGHTS

Saudi Speculation: Expectations that a tender for wheat by Saudi Arabia will include U.S. exports had CBOT wheat futures leading the agricultural complex higher Thursday. "Over 500,000 metric tons of April-June wheat is likely to include U.S. hard red wheat," said AgResource. "No Russian exporter is willing to offer new crop wheat amid all the uncertainty of the floating export tax rate--the floating Russian export tax rate will limit their new crop sales in the months ahead." A wave of tenders by importing nations has been announced in recent days.

Finding Balance: The uptick seen in wider markets Thursday came as grain traders tried to balance out the selling seen earlier this week. "Corn is catching a nice bounce this morning as the market is viewing the early week weakness as too much," said Doug Bergman of RCM Alternatives. Soybeans and wheat are also higher Thursday, although supply fundamentals suggest that futures may again turn lower going forward--particularly soybeans, Mr. Bergman said. "Unless South American production ideas start to drop, beans are going to struggle to add value."

INSIGHTS

Healthy Rains: Soybeans growing in Brazil right now are receiving adequate rainfall to sustain a strong crop, said Arlan Suderman of StoneX. "Rainfall is just a little over the long-term average for the period," he said. "There are certainly localized regions that are dry, as there are in the U.S. Midwest each year, but most areas have seen good rains." Mr. Suderman adds that below-average rainfall is expected to be seen in December, but that will likely affect soybeans growing in Argentina more than Brazil. StoneX forecasts that the Brazilian soybean crop will be a record large one of over 145 million metric tons.

Improving Income: The USDA reports this week that net farm income is expected to rise $22 billion from last year to $116.8 billion. This continues an upward trend for farm income, which rose $15.7 billion last year. The uptick comes mostly due to higher prices for row crops, with government aid payments backing off. According to the USDA, direct government payments will total $27.2 billion. That's down over 40% from last year, due mostly to lower disaster assistance to farmers and ranchers stemming from Covid-19 as well as ending of market facilitation programs paying farmers for lost export sales.

Price Climb: Global food prices rose for a fourth consecutive month in November, reaching their highest level since June 2011, the United Nations's Food and Agriculture Organization said Thursday. The UN FAO's Food Price Index rose 1.2% to 134.4 in November from October, driven by continued strong demand for basic food commodities. The index, which tracks the cost of a basket of foodstuffs, rose thanks to price increases for grains, dairy and sugar, while meat and vegetable oil prices weakened slightly.

AHEAD:

--The CFTC will release its weekly commitment of traders report at 3:30 p.m. ET Friday.

--The USDA will release its weekly export inspections report at 11 a.m. ET Monday.

--The EIA will release its weekly ethanol production and stocks report at 10:30 a.m. ET Wednesday.

--Will Horner contributed to this article.

Write to Kirk Maltais at kirk.maltais@wsj.com

(END) Dow Jones Newswires

December 02, 2021 15:16 ET (20:16 GMT)

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