Wheat futures ease, but Russia-Ukraine tensions limit losses

SINGAPORE — Chicago wheat futures dipped on Friday after a strong performance in the previous session, although heightened tensions between leading grains suppliers Russia and Ukraine limited losses.

The most-active wheat contract on the Chicago Board of Trade (CBOT) was down 0.4% at $8.01-1/2 a bushel, as of 0159 GMT, after gaining more than 3% in the previous session.

Soybeans added 0.1% to $15.93 a bushel, while corn lost 0.4% to $6.47-1/4 a bushel.

Wheat is on track for a second weekly gain, while soybeans are in the positive territory for a fifth week.

U.S. President Joe Biden said on Thursday there was now every indication Russia was planning to invade Ukraine in the next few days and was preparing a pretext to justify it, after Ukrainian forces and pro-Moscow rebels traded fire in eastern Ukraine.

The International Grains Council on Thursday trimmed its forecast for 2021/22 global corn production, partly driven by downgraded outlooks for Brazil and Argentina.

In its monthly update, the inter-governmental body cut the forecast by 4 million tonnes to 1.203 billion.

Argentina’s agricultural heartland, hit by a drought that is affecting corn and soybean crops, is set for a week of scant rainfall before heavier precipitation towards the end of February, the Buenos Aires grains exchange said on Thursday.

Argentina, the world’s top exporter of processed soy and the no. 2 corn exporter, has been suffering from drought linked to the La Niña climate pattern, which has prompted deep cuts in forecasts for harvests of the two grains in recent months.

Strong export demand lent support to soy futures.

The U.S. Agriculture Department said on Thursday morning that export sales of soybeans totalled 2.888 million tonnes in the week ended Feb. 10, up from 2.446 million a week earlier.

Separately, the USDA also said private exporters reported the sale of 120,000 tones of soybeans to unknown destinations, the third day in a row a deal for U.S. soy was announced.

Commodity funds were net buyers of Chicago Board of Trade wheat, soybean, corn and soymeal futures contracts and net sellers of soyoil futures on Thursday, traders said. (Reporting by Naveen Thukral; Editing by Sherry Jacob-Phillips and Shailesh Kuber)