Chicago wheat futures traded slightly higher on Thursday, reaching their highest level since early January, as concerns persist over dry weather in top exporter Russia.
The most-active wheat contract on the Chicago Board of Trade (CBOT) was up 0.9% at $6.18-3/4 per bushel by 1138 GMT, after hitting a high of $6.23-1/2 earlier in the session. This came as forecasts showed limited rain relief in southern Russia until at least early May, raising concerns about the impact on spring wheat crops.
“You still have the weather in Russia that is a cause of concern,” said Maxence Devillers, an analyst with Argus Media.
The dry weather in key wheat-producing regions, including parts of the U.S. Plains, has led investors to cover some of their large short positions in wheat, providing support to prices.
However, large Russian wheat exports, which contributed to three-year lows in wheat markets last month, remained a curb on price gains. U.S. and European wheat futures were also facing chart resistance after their recent highs, traders said.
Corn futures were little changed, while soybeans edged lower as the markets continued to monitor planting progress in the United States and harvest prospects in South America. Rain and colder temperatures in the Midwest could hinder corn and soybean planting later this week.
Traders will also be watching for updates on overseas demand from the weekly U.S. export sales report later on Thursday. Export competition from Brazil has been capping soy and corn prices.
Overall, the wheat market remains focused on weather conditions, particularly in Russia, as well as the global supply and demand balance, which will continue to shape price movements in the coming weeks.