Chicago corn futures rose for a second session on Thursday, with prices underpinned by strong Chinese demand, although gains were limited by favourable crop weather across the U.S. Midwest.
Wheat prices rose for the first time in nine sessions, while soybeans edged lower. "One major reason is that supply conditions from season 2020 are already tight across feed markets and are likely still tightening," said Tobin Gorey, director of agricultural strategy at Commonwealth Bank of Australia.
"Also, playing a part is demand having slowly caught up with supply over the past five seasons or so. So, the return to 'normal' crops in season 2021 does not ease the tightness much."
The most-active corn contract on the Chicago Board Of Trade (CBOT) added 0.2% to $6.25-1/2 a bushel by 1055 GMT. Wheat rose 1.2% to $6.56-1/4 a bushel and soybeans lost 0.4% to $14.97 a bushel. Brisk feed grain demand from China and dwindling expectations for Brazil's corn harvest are driving up prices but brisk U.S. planting and rainfall in the Midwest are capping gains.
"New factors will be needed to significantly move prices, which seem to have to stabilize a bit, especially after the large profits and funds taken in recent days," French consultancy Agritel said in a note.
Widespread rains have boosted recently seeded corn and soybeans and lessened some dryness concerns in portions of the western Corn Belt. Forecasters expect further rains across the Midwest through Friday, with additional precipitation next week in the Ohio River Valley and the central Midwest.
Dryness, however, remains a concern in portions of the Dakotas, forecasters said. Grain traders are beginning to square positions ahead of the long U.S. Memorial Day weekend, with markets closed on Monday.
Argentine port workers unions said in a statement on Wednesday they were ending a strike that they had started in the early morning over access to COVID-19 vaccinations.
Commodity funds were net buyers of CBOT corn futures contracts on Wednesday and net sellers of wheat, soybeans, soymeal and soyoil, traders said.