Grain and soybean futures inched higher Wednesday as speculation about the impact of inclement domestic weather continued to guide trading.
With enormous domestic and global stockpiles, traders are looking for any signs that poor weather might disrupt this year's harvest and ease the downward pressure on prices.
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A dramatic weekend of late season snow and heavy rain across key crop growing regions of the U.S. brought that possibility into play. Snow smashed the new wheat crop in states such as Kansas, while puddles flooded recently planted fields in the Corn Belt.
"When you're neck-deep in the swamp, it's hard not to think about alligators," said Dave Marshall, a farm-marketing adviser for First Choice Commodities in southern Illinois, one of the worst-affected regions. "The current rain event is not only delaying planting but also making it more likely a lot of the previously planted corn will have to be replanted."
The rain has also disrupted barge traffic on the Mississippi River, Mr. Marshall said, bringing grain movement in some regions to a near standstill.
Analysts remain divided over how much the weather will impact the crops. The U.S. Department of Agriculture showed corn plantings as of Sunday on track with historical averages, while an ongoing crop-quality tour in Kansas has yet to report a dramatic decline in wheat yields.
Analysts say both those outlooks could quickly change, however, with more rain expected in parts of the Midwest in the coming days and the Wheat Quality Council tour heading into new parts of Kansas.
"Try as we might, we've got all sorts of agronomists and production people who say we're not going to know yet," said Dave Green, vice president of the Wheat Quality Council.
Traders have nevertheless built small premiums into grain and soybean prices in recent days.
May wheat futures closed 0.3% higher at $4.43 a bushel in Wednesday's session at the Chicago Board of Trade. CBOT May corn closed up 0.6% at $3.66 1/4 a bushel.
Soybeans, which are at an earlier stage of planting than corn, rose 0.8% to $9.65 1/2 a bushel, the highest close since late March.
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(END) Dow Jones Newswires
May 03, 2017 15:57 ET (19:57 GMT)