Forexpros – Wheat futures pulled back from a three-day high on Monday, paring gains made on the back of hopes for a comprehensive plan to contain the debt crisis in the euro zone, while speculation of increased demand for U.S. supplies underpinned prices.
On the Chicago Mercantile Exchange, wheat futures for December delivery traded at USD6.2400 a bushel during European morning trade, gaining 0.22%.
It earlier rose by as much as 1.6% to trade at USD6.3412 a bushel, the highest price since October 12.
At the conclusion of the Group of 20 summit in Paris on Saturday, world financial leaders urged policy makers in the euro zone to deal “decisively” with the region’s ongoing debt crisis.
European leaders were expected to complete the rescue plan at a summit on October 23, in time to present to a meeting of G-20 leaders early next month.
However, wheat futures came off their highs as the U.S. dollar turned higher against the euro after German Finance Minister Wolfgang Schaeuble warned earlier that the upcoming EU summit would not produce a definitive solution to region’s debt crisis.
The dollar index, which tracks the performance of the U.S. dollar against a basket of six other major currencies, was up 0.49% to trade at 77.25, reversing an earlier loss of as much as 0.25%.
A stronger dollar reduces the appeal of U.S. crops to overseas buyers and makes commodities less attractive as an alternative investment.
Wheat prices remained supported after Ukraine’s Agrarian Confederation said in a report published Sunday that the nation’s grain exports fell to 400,000 metric tons in the first 13 days of October from 830,000 tons a month earlier, as taxes on grain exports weighed.
Lower wheat exports from Ukraine could boost demand for U.S. supplies, which is the world’s third largest wheat producer and biggest exporter.
Grain traders were awaiting Tuesday’s report on Chinese gross domestic product for the third quarter to gauge the economic strength of the world’s largest wheat consumer.
Elsewhere on the Chicago Mercantile Exchange, corn for December delivery shed 0.29% to trade at USD6.3838 a bushel, while soybeans for November delivery fell 1.17% to trade at USD12.5513 a bushel.
Forexpros
