Wheat falls after two-day gains of 3 pct on weather fears

Wheat_harvest

U.S. wheat fell for the first time in three sessions on Wednesday, edging down from a two-week high, although forecasts for potential crop damaging weather provided a floor to losses.

FUNDAMENTALS

* The most active wheat contract on the Chicago Board of Trade fell 0.3 percent to $4.75-1/2 a bushel, having closed up 1.2 percent on Tuesday when prices hit $4.75-1/2 a bushel – the highest since March 15.

* Wheat has risen nearly 3 percent this week.

* The most active soybeans futures contract fell 0.1 percent to $9.15 a bushel, having firmed 0.8 percent on Tuesday when prices rose as far as $9.17 a bushel – the highest since October, 2015.

* The most active corn futures fell 0.1 percent to $3.72-1/2 a bushel, having gained 0.7 percent in the previous session when prices hit a high of $3.73 a bushel – the highest since of Feb. 4.

* Weather forecasts suggested dry conditions would persist in the southern U.S. Plains, a key zone for hard red winter wheat production, while other areas have recorded chilly temperatures.

* China plans to scrap its giant corn stockpiling scheme and allow markets to set prices for the grain, the State Administration of Grain said in a statement.

* A weekly Commodity Futures Trading Commission report last week showed large speculators expanded net short positions in CBOT wheat to 127,479 contracts in the week ended March 22.

* Traders were also turning their attention toward Thursday’s USDA spring planting estimates, which will be released alongside quarterly grain stocks data.

* Analysts, on average, expected the USDA to report a jump in corn and soybean seedings over last year, despite three years of falling prices.

MARKET NEWS

* Dollar bulls were on the defensive early on Wednesday after yet another setback inflicted by Federal Reserve chair Janet Yellen, whose cautious tone left markets wondering if there will be even one hike in U.S. interest rates this year.

* U.S. crude futures rebounded in early Asian trade on Wednesday, buoyed by a forecast of a less than expected build in crude oil stockpiles last week, although concern over an oversupplied market and a stronger dollar put a ceiling on gains.

* The S&P 500 closed at its highest in 2016 on Tuesday after Federal Reserve Chair Janet Yellen called for caution on raising interest rates – music to Wall Street’s ears.

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