Wheat eases from 3-month top; dryness, supply woes curb downside

Chicago wheat slid on Thursday as the market took a breather after climbing in the previous session to its highest since late January, although dryness in key exporting countries and Russian attacks on Ukraine are likely to limit the decline.

Corn and soybean prices weakened amid planting in the U.S. Midwest, but wet weather is forecast for the region and could slow the progress in the fields.

The most-active wheat contract on the Chicago Board of Trade (CBOT) ZW1! was down quarter of a cent at $6.12-3/4 a bushel, as of 0311 GMT, having hit its highest since Jan. 25 at $6.17 a bushel in the previous session.

Corn ZC1! gave up 0.3% to $4.47-1/4 a bushel and soybeans ZS1! fell 0.1% to $11.74-3/4 a bushel.

Dry weather is continuing to impact wheat-producing regions of Russia and the United States.

In addition, attacks on Ukraine's Black Sea ports, which affected the country's grain infrastructure, raised fears of supply disruptions.

India is struggling to replenish its wheat stocks, with purchases down around 25% on last year's levels due to untimely rains and higher open market prices, which encourage farmers to sell to private traders.

If the world's second-biggest wheat producer is unable to rebuild stocks as hoped, its ability to intervene in the market to calm prices may be curbed, and New Delhi may have to import wheat for the first time since 2017.

For corn and soybeans, rain and colder temperatures in the Midwest could hinder planting progress later this week.

The U.S. Department of Agriculture (USDA) reported late on Monday that 8% of the U.S. soybean crop was planted, as of Sunday, ahead of expectations, according to analysts polled by Reuters, who predicted 7% of the crop planted.

Argentine corn farmers are bracing for a warmer-than-usual Southern Hemisphere winter that will likely undermine efforts to reduce the population of leafhopper insects that damage the crop, the Rosario grains exchange (BCR) said on Wednesday.

BCR has cut its corn harvest forecast by 6.5 million metric tons to settle at 50.5 million tons, citing damage attributed to the leafhopper outbreak for the downward revision.

Commodity funds were net buyers of CBOT wheat and soybeans on Wednesday. Funds were net sellers of corn and soyoil. Soy meal futures contracts were flat, traders said. (COMFUND/CBT)