By Kirk Maltais
--Corn for December delivery rose 5.2% to $5.32 1/2 a bushel, on the Chicago Board of Trade on Tuesday, on expectations that the rest of the month will be drier and hotter for U.S. crops.
--Wheat for September delivery rose 2.4% to $6.69 1/4 a bushel.
--Soybeans for November delivery rose 1.2% to $13.94 1/2 a bushel.
HIGHLIGHTS
Thinning Out: Rainfall in the Midwest looks to be tapering out, giving way to a drier and hotter conclusion to the month - which in turn may damage U.S. crops, particularly corn. "Hot and dry weather is also a bullish feature as we potentially curtail yields," says Brian Hoops of Midwest Market Solutions. The heat comes as corn is in the pollination phase - and, if interrupted, could significantly impact yields. Hoops adds that a lower U.S. dollar is also supportive for corn.
Port Attack: An attack on the Ukrainian port city of Odesa is adding to concerns that Russia is elevating its aggression in the war, which is lifting CBOT grain futures. "The Russian war against Ukraine is becoming more dangerous as both sides go on their summer offensives," said AgResource in a note. "Concern is growing that Ukraine ports will soon be mined to prevent a Russian offensive from the sea or to limit trade from the 3 open ports." The effect this will have on the grain export markets is driving trading, said the firm.
INSIGHT
End Result: Traders continue to mull over the effect of Russia exiting the Black Sea grain deal - particularly if Russia follows through on blockading Ukrainian port cities, something that seems more likely after the attack on Odesa Tuesday. "The consequences for the global corn supply are far more serious in any case," said Commerzbank in a note. "The grains corridor has so far been used primarily to export corn, which according to UN data has so far accounted for 50% of total exports."
Mighty Healthy: The soft red wheat harvest in France appears to be healthy, said Stratégie Grains, citing a tour performed by the firm. "The crop tour revealed good yields, surpassing the 2022 harvest and the five-year average, particularly in central France and the Nouvelle-Aquitaine region," said Benoit Fayaud, Head of Grain Analysis at Stratégie Grains. The firm adds that the French soft wheat yield is now projected to be 7.61 tons per hectare, resulting in a production forecast of 36.4 million tons. This influx of wheat from France may put more pressure on export prices for wheat globally.
AHEAD
--The EIA will release its weekly ethanol production and stocks report at 10:30 a.m. ET Wednesday.
--The USDA will release its weekly export sales report at 8:30 a.m. ET Thursday.
--The USDA will release its monthly livestock slaughter report at 3 p.m. ET Thursday.
Write to Kirk Maltais at kirk.maltais@wsj.com
(END) Dow Jones Newswires
07-18-23 1556ET
