US dollar weakness and weather concerns lead to a soaring wheat price

Many agriculturals also profited from the depreciating US dollar yesterday. The wheat price in Chicago for example was able to gain by a further 3.8% after having already risen by 3.5% on Monday. Many short positions are also likely to have been covered in recent days after prices fell sharply in the final days of May. 

The upswing in prices is also finding support from the latest news on the fundamental side, however: following the heavy rainfall and flooding in the southern US Great Plains, the USDA lowered the proportion of wheat plants in good or excellent condition nationwide by 1 percentage point to 44%. Late frost is giving cause for concern in Canada, while in the EU the European Commission recently decided against raising its production forecast for soft wheat despite its forecasting unit MARS having upwardly revised the anticipated yields just a few days earlier, notes Commerzbank.