On the international markets wheat rose for the first time in three sessions as hot, dry weather in the southern U.S. Great Plains threatens the winter crop and rain in northern states delays planting of spring varieties. Corn jumped. Soybeans fell. The wheat market is struggling to find direction with concerns about US production offset by outlooks for increased world output. Spring wheat was 79% planted as of May 26, below the five-year average of 86% government data show.

Wheat futures for July delivery rose 1.3% to settle at $7.0275 a bushel  on the Chicago Board of Trade. The price dropped 1.4% in the previous two sessions. The grain has declined 9.7% this year as the U.S. Department of Agriculture forecast that world production will rise to a record in the 12 months that start June 1. Corn futures for December delivery added 2.7% to $5.6575 a bushel in Chicago on speculation that delayed planting will curb U.S. production that’s expected to surge to a record in the year that starts on Sept. 1. The price has plunged 19% in 2013. Soybean futures for July delivery fell 0.5% to $15.0175 a bushel on the CBOT. The oilseed has gained 6.5% this year. Today, the USDA reported the cancellation of 147,000 metric tons of export sales to China.

On the cotton front price fell, extending the longest slump since June, on speculation that slowing growth in China will curb demand. The International Monetary Fund lowered its forecasts for growth in China, the world’s biggest user of the fibre, to about 7.75% this year and next. In April, the IMF projected growth of 8% this year and 8.2% in 2014. Through May 26, 59% of the U.S. cotton crop was planted, up from 39% a week earlier, the government said in a report yesterday. Sowing is about 17 percentage points behind last year.

Domestic demand for old crop wheat stocks and sorghum as it comes off remains very strong with strong competition from buyers over increasingly limited available supplies. Prices for movement in to Queensland continue to strengthen, with a delivered Brisbane price at $336 equating to better than $280 ex farm for north of Moree. Also parcels of wheat located in sites in the north of the state are attracted significant premiums over generic track Newcastle numbers, around $317 track. As sorghum harvest advances slowly we have options available for sorghum stocks that have moisture levels above the GTA maximum specifications, please give the office a call if this is of interest.

With rain over the last fortnight and forecasts for more over the weekend has seen an increase in the pace of sowings for growers who had reasonable levels of sub soil moisture. New crop wheat prices are at respectable levels, with track numbers in the mid $280s for Brisbane and Newcastle. This represents a basis of approximately AU$10/mt over current futures values. Futures values are currently finding support in the volatility around weather in the important planting period for Northern Hemisphere crops, however prices are expected to weaken if current large production estimates are matched by favourable growing conditions.