Wheat Surges as Fund Traders Buy In
By Kirk Maltais
--Wheat for July delivery rose 5.3% to $7.10 1/2 a bushel, the
highest close since May 2014 on the Chicago Board of Trade
Thursday, with commercial traders jumping into futures amid global
--Corn for May delivery rose 4% to $6.50 1/2 a bushel, the
highest close since July 2013.
--Soybeans for July delivery rose 2.4% to $15.14 1/4 a bushel,
the highest close since July 2013.
Solid Backdrop: The surge seen in CBOT grains futures Thursday
may appear sudden, but is well-supported by what's currently known
about the world's grains supply, said John Payne of Daniels
Trading. "In my opinion, it's not the algos pushing the market but
a real fear about supply," said Mr. Payne, noting that concerns
about a shrinking second crop of corn from Brazil is what's
spurring fund traders to jump into corn futures. Wheat futures are
rising partially because of the climb in corn, but the
Russian-Ukraine tensions are also impacting trader sentiment
towards wheat. "That's a story that's in the back of my brain,"
said Mr. Payne.
Finding Highs: With supply issues continuing to weigh on the
grains complex, fund traders found it an ideal place to invest
today, pushing row crops all to new highs. "It was off to the races
for the grain and oilseed sector today, as outside money and end
users both chased the market on fears of shortages in the months
ahead," said Arlan Suderman of StoneX.
Weather Market: Cold weather in planting areas has been a
dominant factor in trader sentiments this week. "The most attention
has been on cold temperatures in the United States and what impact
they have had on planting," said Karl Setzer of AgriVisor. "There
have been several reports that it is too cold for corn to be
planted, but given the dry conditions that are accompanying these
temperatures, we are hearing several reports that crops are in fact
Better Than Expected: Export sales of U.S. wheat are higher this
week, exceeding trader expectations. In the USDA's weekly export
sales report for the week ended April 15, wheat sales totaled
614,000 metric tons for both marketing years. The total is well up
from 217,800 tons last week, and slightly exceeds the projections
of grains traders surveyed by The Wall Street Journal this week --
who had expected wheat sales to total anywhere from 100,000 tons to
600,000 tons. Mexico was the leading buyer of U.S. wheat this week,
totaling 137,500 tons. Taiwan, Japan, and Italy were also leading
buyers of wheat exports this week.
Slight Dip: U.S. grain shipments are slightly lower in this
week's report from the USDA. In the agency's latest Grains
Transportation Report this morning, the USDA says that U.S. Class I
railroads originated 24,347 grain carloads for the week ending
April 10, down 5% from the previous week but 10% higher than last
year. Meanwhile, barge grain movements totaled 798,298 tons for the
week ended April 17. This is down 12% from the previous week and
21% higher than last year.
--The USDA will release its monthly cattle on feed report at 3
p.m. ET Friday.
--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 USDA will release its weekly crop progress report at 4
p.m. ET Monday.
Write to Kirk Maltais at firstname.lastname@example.org
(END) Dow Jones Newswires
April 22, 2021 15:13 ET (19:13 GMT)
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