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Chicago Board of Trade (CBOT) grains futures most likely to trade higher next week on record heat in Midwest U.S and not enough rain in central U.S. Plains, analysts said.
Soybeans futures are 7-12 cents higher, corn 4-7 cents higher with wheat called 3-6 cents higher next Monday, investment company AgResource wrote in its pre-opening market calls report.
Analysts said opening week CBOT calls are sharply higher as the central US weather forecast is warmer and drier than what was offered last Friday.
Moreover, the extended forecast maintains a warm and dry flow for the central Plains and Midwest well into late July. The market will more aggressively add weather premium into CBOT prices as yield potential declines.
The United States Department of Agriculture's Friday commitment of traders report reflected that managed funds were long 18,000 contracts of wheat futures, short 46,700 contracts of corn and short 70,200 contracts of soybeans .
Analysts said, the yield reducing central U.S. weather forecast is likely to force funds to a flat or net long position by mid July. There just is not enough rain in the forecast into July 24th with heat in the Plains and Midwest with the drought in the Dakotas continuing to spread south and east.