GRAINS-CBOT wheat up 2.4 percent; corn, soybeans follow
* Argentine weather, China demand give fundamental support
* Bargain buying boosts corn
* Soybeans buoyed by uncertainty over U.S. harvest
(Recasts, updates with U.S. trading, adds new analyst quote, byline, pvs PARIS/SINGAPORE) CHICAGO, Sept 25 (Reuters) - U.S. wheat futures rallied to their highest in more than two months on Wednesday, supported by hopes that U.S. supplies will gain traction in the competition to fill demand from overseas buyers, traders said. The strength in wheat, which has risen for 10 of the last 12 trading sessions, spilled over into the corn and soybean market. Wheat's recent gains -- prices for the benchmark Chicago Board of Trade December soft red winter wheat contract have risen 4.2 percent so for this week -- have also caused some investors to cover short positions in the commodity as the market has surged through key technical resistance points. Worries that frost in Argentina will limit crop production there as well as expectations that demand from China will rise with domestic prices hit all-time highs and dwindling high-quality supplies have boosted export prospects for U.S. supplies and spurred the futures buying. "Both of those things give the market a little bit better reason to try to poke above resistance and see if we can reach a higher value level," said Bill Gentry, a broker at Risk Management Commodities. Fundamentals suggest the market may be able to hold onto recent gains, even with domestic supplies abundant and the harvest of the largest Canadian crop in more than two decades. "Unfavourable crop conditions in Argentina could reduce the global supply of wheat and overseas buyers will turn to U.S. wheat," said Joyce Liu, an investment analyst at Phillip Futures Singapore. "China needs to import more wheat to meet its needs as bad weather ruined its domestic crop." CBOT December wheat futures were up 15-1/2 cents at $6.73-3/4 a bushel as of 11:31 a.m. CDT (1631 GMT). Prices peaked at $6.74 a bushel, the highest on a continuous basis for the front-month contract since July 17. The gains pushed CBOT December wheat above the high end of its 20-day Bollinger range for the first time since May 3. MGEX spring wheat and KCBT winter wheat also posted strong gains CBOT December corn was up 6-3/4 cents at $4.55-1/2 per bushel while CBOT November soybeans were 7 cents higher at $13.19-1/2 a bushel. Uncertainty over U.S. production as harvest nears added further support to soybeans. Bargain buyers helped prop up corn after the front-month contract dropped to a three-year low on Tuesday. The gains in the corn market were limited by seasonal harvest pressure as early yield reports from the field were better-than-expected in eastern areas of the U.S. Midwest. Satisfactory weather is expected over the next couple of weeks for harvesting of the 2013 U.S. corn and soybean crops, an agricultural meteorologist said. "Expectations of a record corn output will continue pressuring corn prices going forward," said Liu.
Prices at 11:30 a.m. CDT (1630 GMT)
LAST NET PCT YTD CHG CHG CHG CBOT corn 455.50 6.75 1.5% -34.8% CBOT soy 1319.50 7.00 0.5% -7.0% CBOT meal 417.00 2.90 0.7% -0.9% CBOT soyoil 42.07 0.23 0.6% -14.4% CBOT wheat 673.75 15.50 2.4% -13.4% CBOT rice 1551.50 3.00 0.2% 4.4% EU wheat 190.75 3.25 1.7% -23.8% US crude 102.98 -0.15 -0.2% 12.2% Dow Jones 15,314 -21 -0.1% 16.9% Gold 1334.46 11.87 0.9% -20.3% Euro/dollar 1.3526 0.0054 0.4% 2.5% Dollar Index 80.3190 -0.2440 -0.3% 0.7% Baltic Freight 2127 106 5.2% 204.3%
In U.S. cents, benchmark contracts, except EU wheat (euros) and soymeal (dollars). CBOT wheat, corn and soybeans per bushel, rice per hundredweight, soymeal per ton and soyoil per lb.
(Additional reporting by Sybille de La Hamaide in Paris and Naveen Thukral in Singapore)