Grain futures rally after USDA’s crop outlook report
By Nick Godt, MarketWatch
NEW YORK (MarketWatch) — Crude-oil futures rose on Wednesday, tracking broad market optimism over European sovereign debt issues after Portugal was successful in a closely watched bond sale.
Upbeat German data also provided a lift while traders awaited the Energy Department’s estimate of weekly crude supplies later in the session.
“The acceleration of global growth looks on track as we move into the new year,” JPMorgan energy team’s said in a note. “However further price strength from this juncture may well start to undermine demand growth.”
Crude oil for February delivery (CLG11 91.84, +0.73, +0.80%) recently gained 78 cents, or 0.9%, to $91.89 a barrel.
Portugal’s government Wednesday sold 1.25 billion euros ($1.62 billion) of bonds, easing some fears that it would find it hard to access capital markets. Read more on Portuguese bonds.
The contract had rallied on Tuesday, still getting a lift from the shutdown of a pipeline in Alaska.
The Trans Alaska Pipeline System resumed operations for an interim period late Tuesday, according to a statement from the Alyeska Pipeline Service Company.
The pipeline had been shut down on Saturday after a leak of crude oil was discovered in a booster pump room basement.
The pipeline carries about 630,000 barrels a day for co-owners BP PLC (BP 47.25, +0.42, +0.90%) and Chevron Corp. Pipeline Co. (COP 68.68, +0.51, +0.74%)
(COP 68.68, +0.51, +0.74%) News that U.S. import prices rose 1.1% in December, matching analyst expectations, had little immediate impact on trade.
Meanwhile, traders are keeping an eye for weekly inventories report from the Energy Department’s Energy Information Administration at 10:30 a.m. Eastern.
Analysts polled by Platts expect a drawdown in U.S. commercial crude stocks of about 300,000 barrels for the week ended Jan. 7. Gasoline stocks are seen up 2.9 million barrels, with demand continuing to weaken in line with seasonal patterns, Platts said.
Trade group American Petroleum Institute reported its weekly inventories tally on Tuesday, saying supplies inched up 57,000 barrels for the week.
Grains rally after USDA report
Grains reacted favorably to the U.S. Department of Agriculture’s January supply and demand estimates on Wednesday. Wheat for March delivery (WH11 772.50, +13.00, +1.71%) rallied 60 cents, or 7.9%, to $8.20 a bushel on the Chicago Board of Trade. Read preview of what was expected from the USDA.
Corn and soybeans also rose. Corn for March delivery (CH11 612.50, +5.50, +0.91%) advanced 30 cents, or 5%, to $6.37 a bushel. March soybeans (SH11 1,371, +13.50, +1.00%) rose 70 cents, or 5.2%, to $14.27 a bushel.
