Wheat eases as US crop conditions, dollar rally weigh

Chicago wheat futures edged down on Tuesday as improved U.S. crop conditions added to expectations of ample supply, while a multi-month peak for the dollar dampened export prospects.

Corn and soybeans were almost unchanged as the market awaited a clearer picture of U.S. spring planting after government forecasts last week.

The most active wheat contract on the Chicago Board of Trade (CBOT) ZW1! was down 0.1% at $5.56-1/2 a bushel by 1021 GMT.

The contract was moving back from a near four-week high struck on Thursday when wheat prices tracked a rally in corn following a smaller-than-anticipated projection of this year's U.S. corn area by the U.S. Department of Agriculture.

In its first national crop progress report since before winter, the USDA on Monday rated 56% of the U.S. winter wheat crop in good-to-excellent condition.

That was below average trade expectations but above a pre-winter score of 50% and the highest for this time of year since 2019.

"Large supplies of wheat and other grains such as corn are weighing on pricing," said Andrew Whitelaw at Australian agricultural consultancy Episode 3.

"With a lack of new bullish information, we expect pricing to remain relatively flat with bearish overtones."

Large Russian wheat exports, which consultancy SovEcon estimates set a March record of 4.9 million metric tons last month, remained a curb on futures, despite rising Russian export prices and dry crop weather in the Black Sea region.

Strength in the dollar DXY, which on Tuesday set another 4-1/2 month peak against a basket of major currencies, was denting the export competitiveness of wheat and other U.S. crops.

Rising crude oil prices BRN1! amid geopolitical worries lent some support to corn and soybeans, which are widely processed for use in biofuel.

"The macro environment is sending conflicting signals for agriculture money flows," Peak Trading Research said in a note.

CBOT soybeans ZS1! were up 0.1% at $11.87 a bushel, while corn ZC1! was flat at $4.35-1/2 a bushel.

Like wheat, corn and soybeans remain within sight of 3-1/2 year low due to plentiful global supply.