By Tom Polansek
CHICAGO, Nov 10 (Reuters) – U.S. wheat futures rallied on Wednesday, with the front-month K.C. hard red winter wheat contract KWc1 jumping to its highest in 7-1/2 years, on concerns about tightening global supplies and strong export demand.
Corn futures also rose, with the most-active contract surging 2.6% in its biggest daily percentage gain in four months.
Soybean futures rose for the second day in a row on follow-through buying after the U.S. Agriculture Department’s cut to the harvest outlook sparked a rally on Tuesday.
Wheat’s rise stemmed from hopes that U.S. exporters will pick up some business as other suppliers tighten their grip on stocks.
Top wheat exporter Russia may change the way it calculates grain export taxes in case of price hikes, Agriculture Minister Dmitry Patrushev said. Russia also plans to set export quotas for the first half of 2022.
“Wheat has a story this year, and that story is that the Russians are hell-bent on destroying their leading presence as a wheat exporter to the world,” Charlie Sernatinger, global head of grain futures at ED&F Man Capital, said in a note to clients.
The benchmark Chicago Board of Trade December wheat futures WZ1 ended up 24-1/2 cents at $8.03 a bushel. K.C. December hard red winter wheat KWZ1 gained 24 cents at $8.17-1/2, topping out at $8.19-1/2, the highest for the front-month contract KWc1 since May 13, 2014.
CBOT January soybeans SF2 were up 4-3/4 cents at $12.16-3/4 a bushel.
The soy market hit the 11-month low before the U.S. Department of Agriculture on Tuesday issued a lower-than-expected U.S. soybean crop estimate in a monthly crop report.
The market is readjusting to the “notion of smaller rather than larger 21/22 U.S. supplies,” said Rich Feltes, head of market insights for RJ O’Brien.
CBOT December corn CZ1 rose 13-1/2 cents to $5.69-1/4 a bushel.
(Reporting by Tom Polansek in Chicago, Mark Weinraub in Chicago, Gus Trompiz in Paris and Naveen Thukral in Singapore Editing by David Goodman, Bernadette Baum and Richard Chang)