Corn at 8-year high above $6/bsh on adverse weather

Wheat futures up 1% on weather concerns

  
Corn plants are seen on a field in Jalmolonga, Mexico September 9, 2020.

Corn plants are seen on a field in Jalmolonga, Mexico September 9, 2020.

REUTERS/Claudia Daut

PARIS- Chicago corn futures surpassed the $6 per bushel level for the first time in eight years on Thursday as concerns over cold weather damage to the crop across the U.S. grain belt underpinned prices.

Wheat extended Wednesday's rally, hitting its highest in more than a month, while soybeans extended gains.

"There are expectations of lower corn and soybean planting in the U.S. and now the early growing weather is not perfect," said Pranav Bajoria, a director at Singapore-based brokerage Comglobal. "At the same time demand looks pretty strong, with more use of agricultural products for biofuels."

The most-active corn contract on the Chicago Board of Trade (CBOT) was 1% higher at $6.00-1/4 a bushel by 1050 GMT, after rising to $6.01-1/2 a bushel earlier in the session.

Soybeans added 0.6% to $14.18 a bushel, while wheat Wv1 was up 1% at $6.56-1/2 a bushel after earlier climbing to its highest since March 8 at $6.57 a bushel.

Dry weather and a cold surge expected next week poses risk of damage to the wheat crop in the southern U.S. Plains. In the Midwest, the weather is threatening the newly plated corn.

"The dryness in the U.S. spring wheat growing regions is giving rise to concerns about delays to planting," Commerzbank said in a note. "That said, one or two bad weeks can easily cause this lead to evaporate, turning it into a backlog.

"What is more, a cold snap is looming in the southern U.S. Plains next week, which could damage the wheat plants there."

The cold weather also could cause some growers to delay their planting of corn and soybeans.

Concern also mounted about potential damage from expected dry weather in the European Union in coming weeks, notably in the bloc's largest grain growing country France.

It is too early to estimate the impact on grain crops from a severe frost that has hit France, but there is some concern over damage in the central and southern parts of the country, farm office FranceAgriMer said on Wednesday. 

Commodity funds were net buyers of CBOT corn, soybean, wheat, soymeal and soyoil futures contracts on Wednesday, traders said.

(Reporting by Naveen Thukral; Editing by Shailesh Kuber, Kirsten Donovan) ((naveen.thukral@thomsonreuters.com; +65-6870-3829; Reuters Messaging: naveen.thukral.thomsonreuters.com@reuters.net))

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