Wheat hovers near 2-1/2-month low on surging US dollar

Chicago wheat futures inched loweron Thursday after plunging to a 2-1/2-month low in the previous session as the U.S. dollar surged to its strongest in a year, making U.S. farm exports less competitive on global markets.

Corn and soybean futures steadied after three consecutive days of declines due to the dollar’s pressure, a faltering vegetable oil rally and concerns that a debt swap announced by China last week will fail to stoke its economy.

The most-active wheat contract on the Chicago Board of Trade Wv1 was down 0.1% at $5.40-3/4 a bushel at 0544 GMT after falling on Wednesday to $5.36-1/2, lowest since Aug. 29.

The U.S.dollar .DXY continued to rise, reaching its strongest since November 2023after U.S. consumer price data suggested there could befewer interest rate cuts next year.

“The biggest driver in recent days has been the appreciation of the U.S. dollar,” said Andrew Whitelaw at agricultural consultants Episode 3.

“Rains arrived in Kansas, the largest growing state in the U.S., and expectations are that frost damage in Australia islower than most analysts expected,” Whitelaw added.

“We expect to see slight downward to flat direction in U.S. wheat futures in the coming sessions.”

Cuts to Argentina’s production estimate and France’s export outlook did not outweigh an improvement in cropping conditions in previously dry areas of the United States and the Black Sea region.

In other crops, CBOT soybeans Sv1 rose 0.5% to $10.12-1/2 a bushel and corn Cv1 climbed 0.2% to $4.27-1/4 a bushel.

Soybeans lost support from a rally in vegetable oils. CBOT and Dalian soyoil and Malaysian palm oil futures have fallensharply this week, though CBOT soyoil steadied on Thursday. BOZ24, DBYcv1, FCPOc3

China’s soybean imports are likely to drop to 98.8 million tons in the marketing year ending September 2025from 109.4 million tons in the prior year, an executive of China National Cereals, Oils and Foodstuffs Corporation (COFCO) said on Wednesday.
Source: Reuters (Reporting by Peter Hobson; Editing by Sumana Nandy and Eileen Soreng)