By Kirk Maltais
--Wheat for March delivery rose 1.4% to $6.42 1/2 a bushel, on the Chicago Board of Trade on Thursday, with the streak of Chinese buying of U.S. wheat expected to be reflected in some way in tomorrow's WASDE report.
--Soybeans for January delivery rose 1.2% to $13.10 1/2 a bushel.
--Corn for March delivery rose 0.7% to $4.87 1/2 a bushel.
HIGHLIGHTS
On Edge: Grain traders are unsure how much China's appetite for U.S. wheat may impact ending stocks estimated by the USDA in its WASDE report tomorrow- and are prepping for potential surprises. "Following the recent buying spree from China, the USDA will at some point have to raise their export projections," said Brian Pullam of Linn & Associates. "There is a good chance the USDA will make an adjustment in tomorrow's crop report, but we also may see an increase in export projections in future WASDE's as well." This anticipation pushed wheat prices up to their highest level since August.
Production Cut: Corn and soybeans trading on the CBOT were supported by cuts made to Brazilian production outlooks by Conab, one of the country's agricultural agencies. Conab estimates corn production in Brazil at 160.2 million metric tons, and soybeans at 118.5 million tons - both down from the previous year due to adverse weather. The possibility of Conab's moves being a precursor to tomorrow's WASDE helped lift CBOT grains. "The difficult question is whether the WASDE will follow Conab and adjust their corn production downwards," AgResource said in a note.
INSIGHT
Snapped Streak: The streak of flash sales of U.S. winter wheat to China was snapped today, with the USDA only confirming sales of 121,000 metric tons of soybeans to unknown destinations in its notice today. This initially pressured wheat futures in trading, but attention then shifted towards how the USDA would digest the preceding sales streak in its WASDE report tomorrow.
Fading Strength: Strength in the U.S. dollar seen throughout the year may finally waver in 2024, said Thomas Mathews of Capital Economics in a note. "Our sense is that the dollar's resilience won't last over 2024," he said. "While we do think safe-haven flows could keep it on the front foot a little longer… we anticipate yield gaps will move back against it and the downward trend from November will resume." Strong currency has been a pressure point for grains, with U.S. exports being less competitive when the U.S. dollar is up.
AHEAD
--The USDA will release its monthly world supply and demand report at noon ET Friday.
--The CFTC will release its weekly Commitment of Traders report at 3:30 p.m. ET Friday.
--The USDA will release its weekly grains export inspections report at 11 a.m. ET Monday.
Write to Kirk Maltais at kirk.maltais@wsj.com
(END) Dow Jones Newswires
12-07-23 1522ET
