Chicago: Off The Highs But Still Posts Strong Weekly Gains
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Corn: Jul 12 Corn closed at USD5.91, up 4 1/2 cents; Dec 12 Corn closed at USD5.54, up 4 cents. For the week old crop Jul 12 was up 11 1/2 cents, with Dec 12 adding a much more impressive 48 cents, or 9.5%. As with soybeans, most of the early double digit gains were given up by the close of play - Dec 12 was 17 1/2 cents higher at one stage. Funds were estimated to have been net buyers of around 10,000 corn contracts on the day - a fair volume that you would have thought would have led to a better close than 4 cents higher. Next week has plenty of potential to provide some dramatic trade. Monday's action is likely to be dictated by weekend weather events in the US and the latest forecasts for the week ahead. Monday night we get the latest crop condition ratings from the USDA. Corn and soybeans rated good/excellent will probably see declines of 2-4 percentage points each. Then on Friday we have the USDA's June acreage and quarterly stocks reports. Most traders expect an increase in both corn and soybean planted area from the USDA's March estimates.
Wheat: Jul 12 CBOT Wheat closed at USD6.73 1/4, up 11 1/2 cents; Jul 12 KCBT Wheat closed at USD6.86, up 3 cents; Jul 12 MGEX Wheat closed at USD8.59, up 15 1/4 cents. For the week Jul 12 Chicago wheat was up 63 3/4 cents, or 10.5%, with Kansas wheat gaining 56 cents and Minneapolis adding 71 1/2 cents. So wheat was the star of the week, posting better gains than either corn or soybeans, despite the lack of a really good bullish storyline. Jul 12 Chicago wheat held on to more of it's gains than either of those two managed to do, although Dec 12 finished 6 1/2 cents higher on the day it was more than 10 cents off the intra day highs. Funds were said to have been net buyers of around 4,000 Chicago wheat contracts on the day. Reduced Russian output this year is certainly supportive, bumper crops there last year were responsible for depressing world prices last summer and autumn. Ukraine will also have a much smaller wheat crop this year, but could harvest a record corn crop. Offers of cheap Black Sea corn for new crop positions are already threatening to undermine wheat prices in Europe where wheat production estimates are now rising following plentiful spring rains.