Wheat rebounds on tightening supplies, strong demand

SINGAPORE, Nov 29 (Reuters) – Chicago wheat futures climbed more than 1% on Monday, bouncing back from the previous session’s losses as tightening global supplies and strong demand buoyed the market.

Corn rose for a fifth consecutive session while soybeans gained 1.3%.

The most-active wheat contract on the Chicago Board Of Trade (CBOT) rose 1.3% to $8.51 a bushel by 0350 GMT.

Wheat dropped 1.2% on Friday as news of a new coronaviurs variant discovered in South Africa dragged down global markets.

“We are sceptical that the Omicron variant will diminish wheat demand by much,” said Tobin Gorey, director of agricultural strategy at Commonwealth Bank of Australia.

Soybeans were up 1.3% to $12.68-1/2 a bushel and corn rose quarter of a cent to $5.87 a bushel.

Adverse weather has impacted wheat supplies from key Northern Hemisphere exporters.

U.S. corn and wheat export sales beat expectations, with 1.429 million tonnes of corn sold, primarily to Mexico and Canada, up 58% from the previous week.

U.S. exporters sold 1.565 million tonnes of soybeans during the week of Nov. 18, up 13% from the previous week and the prior four-week average, the U.S. Department of Agriculture reported last week, primarily due to increases in sales to China. Sales were within analysts’ expectations.

Global markets were hit last week by concerns over the new variant of the coronavirus.

The Omicron coronavirus variant spread around the world on Sunday, with new cases found in the Netherlands, Denmark and Australia even as more countries imposed travel restrictions to try to seal themselves off.

However, U.S. stock futures led a market rebound on Monday as investors prepared to wait a few weeks to see if the Omicron coronavirus would really derail economic recoveries and the tightening plans of some central banks.

Commodity funds were net sellers of CBOT wheat, soybean, soyoil and soymeal futures contracts on Friday and net buyers of CBOT corn, traders said.

Reporting by Naveen Thukral; Editing by Subhranshu Sahu

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