Corn and wheat futures rise amid speculation of buying interest
Corn futures have slumped 25% in the past 12 months while wheat fell 19% amid expectations for bumper crops to boost supply.
World grain stocks will rise to a 15-year high by the end of the 2014 to 2015 season as production of both crops outpaces demand, the International Grains Council forecasts.
“We’ve come to a level where it’s starting to be interesting for buyers,” Arnaud Saulais, a broker at Starsupply Commodity Brokers in Nyon, Switzerland, said. “There’s a bit of buyer interest at this moment. It’s always hard to say whether it will resist harvest pressure.”
Corn for December delivery climbed 1% to $3.85 (€2.85) a bushel on the Chicago Board of Trade in yesterday’s trading. The grain dropped to $3.7825 yesterday, the lowest for a most-active contract since July 2010.
Wheat for September delivery advanced 0.4% to $5.40 a bushel, after prices fell to $5.2425 on Monday also the lowest since July 2010. Milling wheat for November delivery traded on Euronext in Paris rose 1% to €178.75 a metric tonne.
Ending stocks of wheat and coarse grains such as corn and barley are predicted to climb to 412m tonnes from 400m tonnes at the end of 2013 to 2014, the International Grains Council said earlier this month. Inventories will be the highest since the end of the 1999 to 2000 season, it estimates.
Corn’s relative strength index, a gauge of price momentum, was at 19.6 by the close yesterday and wheat was at 28.6.
Some analysts view levels below 30 as indicating oversold conditions.
Soybeans for November delivery climbed 0.7% to $10.94 a bushel in Chicago. Prices fell to $10.65 on July 11, the lowest since October 2010.
— Bloomberg
