Soft Commodities Price Watch: Wheat Rebounds as Egypt Returns as Buyer

on Jul 2, 2013
Listen Tuesday, July 2nd: Grain futures have traded mostly higher today, with wheat rising for the first time in nine days, ending its longest slump since June 2005, after the world’s top importer Egypt said it was planning purchases.

Egypt, which accounts for about six percent of the world’s wheat purchases, is seeking to buy at least 60,000 metric tonnes today in its first tender since February, the country’s state-run buyer said on Monday. As of late, Egypt has struggled to pay for food and fuel as foreign currency reserves dwindled amid social unrest. The country’s return to the market has lifted the wheat price from its worst run in eight years.

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After sliding 8.3 percent in the previous eight sessions amid easing concerns over U.S. crop prospects, today the wheat price for September delivery on the Chicago Board of Trade (CBOT) was 6.6575 a bushel, up 1.64 percent on the day. The contract fell to $6.5288 a bushel yesterday — the lowest level since June 20, 2012 — after the U.S. Department of Agriculture (USDA) said that crop conditions have improved over the past week.

Corn for December delivery in Chicago has also risen today, gaining 0.5 percent to $5.0375 a bushel. Weighed on by the USDA’s weekly update on planting progress, the contract fell to $5.0025 yesterday, the lowest since October 8, 2010. Corn for delivery in July, before the harvest, gained as much as 1.1 percent to $6.6250 today.
Soybeans for November delivery rose 0.5 percent to $12.4950 a bushel, after falling to $12.3500, the lowest for a most-active contract since February 2012. Soybeans for delivery in July, before the harvest, were poised to gain for a seventh day after yesterday’s jump to $16.0425, the highest for that contract since September.

**Coffee Advances to Two-Week High amid Declining Stockpiles**
Robusta coffee has climbed to its highest level in almost three weeks today in London on speculation that prices, which fell in the last quarter by the most since 2011, slipped too far amid declining stockpiles in Europe and high premiums in growing nations.
Robusta coffee for September delivery gained 1.5 percent to $1,811 a tonne by 10:55 GMT on the NYSE Liffe in London. Prices, which gained 1.5 percent yesterday, touched $1,812, the highest for a most-active contract since June 12. Arabica coffee for delivery in September gained 1.2 percent to $1.2305 a pound on ICE Futures U.S. in New York.

Elsewhere on the ICE, the sugar price for October delivery traded at $0.1671 a pound, up 0.4 percent on the day, while in London was little changed at $480.90 a tonne. Cocoa for September delivery slid 0.2 percent to £1,449 a tonne in London and 0.3 percent to $2,153 a tonne in New York.
**Rubber Hits Three-Week High as Yen Weakens**
!m[Coffee and Rubber Reach Multi-Week High](/uploads/story/3597/thumbs/pic1_inline.jpg)
Rubber climbed to a three-week high after Japan’s currency weakened to trade near 100 per dollar, boosting the appeal of yen-denominated contracts, and as data showed that the outlook has improved for U.S. manufacturing.
Rubber for delivery in December climbed as much as 3.1 percent to 246.8 yen a kilogram ($2,479 a metric tonne) on the Tokyo Commodity Exchange (TOCOM), the highest level for the most-active contract since June 12. Futures traded at 245.70 yen at 13:26 GMT, paring this year’s losses to 19 percent.
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