Wheat jumps as USDA crop condition report raises supply fears

The most-active wheat futures on the Chicago Board Of Trade were up 1% at $7.04-1/2 a bushel

  
Image used for illustrative purpose. Combines harvest wheat in a field owned by the "Siberia" farming company during sunset outside the village of Ogur in Krasnoyarsk Region, Russia September 8, 2019.

Image used for illustrative purpose. Combines harvest wheat in a field owned by the "Siberia" farming company during sunset outside the village of Ogur in Krasnoyarsk Region, Russia September 8, 2019.

REUTERS/Ilya Naymushin

CANBERRA - U.S. wheat futures rose 1% on Tuesday, extending gains into a fifth session, as global supply concerns grew after the U.S. Department of Agriculture pegged the conditions of crops below market forecasts.

FUNDAMENTALS

* The most-active wheat futures on the Chicago Board Of Trade were up 1% at $7.04-1/2 a bushel by 0204 GMT, having closed up 0.8% on Monday when prices hit a May 18 high of $7.09-1/2 a bushel.

* The most-active soybean futures were up 0.9% to $13.84-1/2 a bushel, having closed down 1.4% on Monday.

* The most-active corn futures were up 0.8% to $5.56-1/2, having closed little changed in the previous session.

* The U.S. Department of Agriculture pegged the U.S. spring wheat crop as 11% good to excellent, down from 16% a week earlier and slightly below analysts' expectations. 

* Additionally, 63% of spring wheat was rated "poor" or "very poor," up from 55% a week earlier.

* Corn was rated 65% good to excellent, 1 point below expectations, while soybeans were in line with analyst predictions.

* Russia's 2021 wheat crop expectations dropped following hot and dry weather in southern Russia, while Ukrainian wheat export prices rose last week on harvest uncertainty in the Black Sea region.

MARKET NEWS

* Safe-harbour currencies like the Japanese yen and U.S. dollar held near multi-month highs against the riskier Australian dollar and British pound on Tuesday, as fears grow that a rampant coronavirus variant could upend the global economic recovery. 

* Oil prices stabilised on Tuesday after slumping around 7% in the previous session amid a broader market retreat led by concerns about a resurgence of COVID-19 infections, which came just as producers inked a new supply deal. 

* Stocks on Wall Street fell as much as 2% on Monday, with the Dow posting its worst day in nine months, as a rise in worldwide coronavirus cases and increasing U.S. deaths drove investors out of risky assets, crushing bond yields and share prices. 

(Reporting by Colin Packham; Editing by Subhranshu Sahu) ((colin.packham@thomsonreuters.com; +61-2 9321 8161; Reuters Messaging: colin.packham.thomsonreuters.com@reuters.net))


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