Chicago wheat futures approached a six-and-a-half year high on Tuesday as plans by leading supplier Russia to tax exports continued to create uncertainty about global availability of the staple grain.
Corn was steady, holding near a 7-1/2 year high struck last week, as discussions in Ukraine about possible export limits also put the focus on supplies after recent restrictions by fellow exporter Argentina.
Soybeans eased back from last week's 6-1/2 year peak, curbed by a sharp fall in palm oil futures. Chicago futures were resuming trade after Monday's holiday closure on US markets.
The most-active wheat contract on the Chicago Board of Trade (CBOT) was up 1.6% at $6.86-1/2 a bushel by 13:06 GMT.
On Friday, it had reached its highest since May 2014 at $6.93. In Europe, front-month wheat futures on Euronext struck another highest since May 2013 at 240.00 euros ($291.00) a tonne.
Wheat Tax
"Russia's higher tax on wheat, and it remaining in place beyond June, continues to reverberate through wheat markets," said Tobin Gorey, director of agricultural strategy at the Commonwealth Bank of Australia.
Russia said on Friday it would impose a wheat export tax of €50 a tonne from 1 March to 30 June, increasing an initial €25 levy to apply from 15 February and also maintain a levy next season.
The proposed taxes, aimed at cooling food inflation, have pushed up both Russian export prices and prices of other origins like US wheat seen in contention to take demand from Russia.
Export Restrictions
Speculation about possible wheat export restrictions by Argentina further supported futures, traders said. Doubts over wheat supply have unnerved investors grappling with tightening availability of corn and soybeans due to strong Chinese demand.
China imported a record 11.3 million tonnes of corn last year, including 2.25 million tonnes in December, according to General Administration of Customs data.
CBOT corn added 0.4% to $5.33-3/4 a bushel, while soybeans shed 1.0% to $14.02-1/2 a bushel. Recent rainfall in Brazil and Argentina have capped rallies in corn and soy by potentially boosting harvest prospects in dry zones.
