Forexpros – Wheat futures were up for the first time in three days on Monday, rebounding from a one-week low after U.S. Congressional leaders reached an agreement to raise the U.S. debt ceiling, boosting appetite for riskier assets.
Chicago Mercantile Exchange, wheat futures for September delivery traded at USD6.8962 a bushel during European morning trade, surging 2.55%.
It earlier rose as much as 2.72% to trade at a daily high of USD6.9038 a bushel. Wheat prices tumbled nearly 3% to hit a one-week low of USD6.7212 a bushel on Friday.
Late on Sunday, President Barack Obama announced a deal between Republicans and Democrats to cut spending and raise the USD14.3 trillion debt ceiling, easing worries about a possible sovereign debt default.
Under the framework deal, which was to be voted on later in the day, the debt ceiling will be raised by at least USD2.1 trillion, sufficient to serve the government’s needs into 2013.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was down 0.25% to trade at a three-day low of 73.79.
A weaker dollar boosts the appeal of U.S. crops to overseas buyers and makes commodities more attractive as an alternative investment.
Meanwhile, warmer-than-normal weather was expected in key wheat-growing states in the U.S during the upcoming week, potentially threatening yields and reducing the quality of the harvest.
According to weather service provider AccuWeather, temperatures in parts of Kansas, Oklahoma and Texas rose above 100 degrees Fahrenheit over the weekend.
The U.S. is the world’s third largest wheat producer and biggest exporter of the grain.
Elsewhere, corn for September delivery jumped 1.27% to trade at USD6.7538 a bushel, while soybeans for September delivery advanced 1.2% to trade at USD13.6250 a bushel.
Later in the day, the U.S. Department of Agriculture was to publish its weekly crop progress report, which would provide an indication on how U.S. crops fared during the recent heat wave.
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