Grain futures mixed, wheat retreats from 3-month high as concern over Ukraine shipments eases

Grain futures were mixed on Thursday, wheat extended a decline from a three-month high amid speculation for ample global supplies and as concern eased that tension between Ukraine and the Russian Federation may result in disruption of exports from the sixth-largest exporter, Ukraine. Meanwhile, soybeans advanced, while corn hovered near six-month high.

On the Chicago Board of Trade, wheat futures for settlement in May lost 0.4% to trade at $6.3962 per bushel by 14:55 GMT. Prices touched a session high of $6.4225 per bushel, while day’s bottom was touched at $6.3638 a bushel. On March 4th, prices touched $6.4462, the strongest since December 10.

Wheat settled 8.2% up in February, after plunging 8.3% in January and 9.5% in December, on expectations for a record global output of 712.7 million tons.

“Markets are pretty well supplied, so it’s not like you’re hurting,” Ivan Szpakowski, commodities strategist at Citigroup Inc., said at a briefing in Melbourne today, cited by Bloomberg. “If you do see a sustained difficulty exporting, then that will impact corn,” he added, referring to exports from Ukraine.

According to data by the International Grains Council (IGC), Ukraine will be the sixth-largest global wheat exporter, as it is forecast to ship 9.5 million metric tons of the grain in the 2013-14 season through June, up from 7.1 million tons a year ago.

The 5 major ports, including Odessa, which account for almost 90% of Ukraines grain shipments are a long way from Crimean and exports wont probably be disrupted, according to Morgan Stanley.

On March 4th, Russian President Vladimir Putin, in his first public remarks, after Ukraine announced the region of Crimea had been seized by Russian forces, said while he kept the right to use military forces to defend ethnic Russians, there was no immediate necessity to do so at the moment.

DTN’s March 5th forecast called for cold weather over the Midwest to continue for several more days, before temperatures moderate somewhat early next week, after which they will turn lower later next week. However, temperatures are not seen cold enough to harm the dormant winter wheat in the region, but soil warming will be slow for spring row-crop fieldwork.

Meanwhile, chances for precipitation over the Southern Plains seem to be limited in the next ten days. Any moisture received wont be enough to recharge soil moisture, as spring is coming. The website also reported that no significant cold temperatures are expected over the year in the next seven-to-ten days.

Elsewhere on the grains market, soybeans futures for settlement in May, rose 1.12% to trade at $14.3688 per bushel by 14:56 GMT. Futures touched a session high at $14.3738 per bushel, while day’s low was hit at $14.1662 per bushel. On February 27, prices touched $14.4375 per bushel, the strongest since July 24th. The grain settled last week 2.5% higher, after adding 0.5% in the previous 5-day period. However, the oilseed has lost 8.5% in 2013.

Corn hovers near six-month high

On the Chicago Board of Trade, corn futures for May delivery surged by 1.03% to trade at $4.8638 a bushel by 14:57 GMT. Futures hit a session high at $4.8750 per bushel, while day’s low was touched at $4.7862 per bushel. Yesterday prices touched $4.8788 per bushel, the strongest since September 3. Corn futures headed for a 3.6% gain this week, which would be a seventh straight advance.

Corn has advanced 14% this year after it lost nearly 40% in 2013, the steepest annual drop on record and the worst annual performance since at least 1959.

DTN.com reported on March 5th that soil moisture for second crop and late-filling early crops in central Brazil is adequate to surplus at the moment. A drier trend is possible for the next five dasys or so, before potentially heavy rain develops over the Mato Grosso producing region. Area which will experience less rain should see improved conditions for harvest, while areas with heavier rainfall may lose additional soybeans crop, because of wet conditions.

Meanwhile, the website reported that conditions in central Argentina will continue to be mostly favorable for filling and maturing corn and soybeans at this time. Thunderstorms are expected to return over the region during the next week. Rainfall would be favorable for filling crops, but will be neutral at best for maturing crops.