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Grain futures - Weekly review: October 17-21

Published 10/23/2011, 10:04 AM
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Investing.com – Corn and wheat futures rose on Friday, boosted by a broadly weaker U.S. dollar and amid hopes for a resolution to the ongoing debt crisis in the euro zone, while soybean futures settled close to a two-week low after government data showed U.S. soybean export sales fell sharply last week.

On the Chicago Mercantile Exchange, corn futures for December delivery traded at USD6.4925 per bushel by close of trade on Friday, climbing 1.13% over the week, the third consecutive weekly gain.

Corn prices rose by as much as 2.4% on Friday before paring gains on profit taking after German officials said that there were several possible ways of involving the International Monetary Fund in expanding the capacity of the euro zone’s bailout fund, the European Financial Stability Facility.

EU leaders continued to hold talks over the weekend to work out a plan to recapitalize the region’s banks, bolster the firepower of the EFSF and restructure Greek sovereign debt.

A comprehensive response to the two-year old sovereign-debt crisis was expected to be unveiled at a summit Sunday or at a follow-up meeting on Wednesday. 

The U.S. dollar came under broad selling pressure, with the dollar index slumping 0.91% to settle at 76.52 by close of trade Friday, the lowest level since September 9.

A weaker dollar boosts the appeal of U.S. crops to overseas buyers and makes commodities more attractive as an alternative investment.

Corn prices found further support after the U.S. Department of Agriculture said that the volume of corn inspected for delivery at U.S. ports totaled 1.763 million metric tons last week, the most since early March.
 
Elsewhere on the Chicago Board of Trade, wheat for December delivery rose 1.2% over the week to settle at USD6.3150 a bushel on Friday, the second consecutive weekly gain.

Wheat prices tracked movements in corn futures on Friday, jumping nearly 2.8% before falling back. Concerns over U.S. winter-wheat crop conditions underpinned prices after industry weather group MDA Federal said that it expected mostly dry weather in key U.S. wheat-growing states through the end of October.  

Meanwhile, soybeans for November delivery tumbled 4.45% on the week to settle at USD12.1250 a bushel, hovering close to the previous session’s eight-day low of USD12.0125 a bushel.

The USDA said that soybeans inspected for delivery at U.S. ports last week fell by 12% from a week earlier to 594,743 tons. Exports of U.S. soybean supplies were down 71% from a year earlier.

Corn is the biggest U.S. crop, valued at USD66.7 billion in 2010, followed by soybeans at USD38.9 billion, government figures show. Wheat was fourth at USD13 billion, behind hay.

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