Wheat gains as traders weigh export prospects amid Hurricane Ida

Wheat rose as investors focused on Hurricane Ida for any signs of disruption to U.S. exports while weighing a broader advance in risk assets following dovish comments from the Federal Reserve. 

Hurricane Ida barreled into the Louisiana coast on Sunday, imperiling U.S. energy supplies as well as key transport routes for soybeans and corn. After Ida comes ashore, it could flood cotton, corn, soybean and sugarcane crops, according to forecaster Maxar. 

Major grain traders have shuttered export terminals and at least one soybean crushing plant on the weekend. The lower Mississippi river is by far the largest export region for soybeans and corn, accounting for more than half of U.S. shipments. 

Risk assets such as commodities were also boosted after the Federal Reserve Chair Jerome Powell said the central bank won’t be in a hurry to raise interest rates. The prospects for reduced central bank support has been a talking point in markets, as the spread of the delta variant continues to weigh on the economic recovery and demand outlook for commodities.

Wheat climbed as much as 1.5% Monday. Supply across major producing regions in Russia, Canada and Europe have been pummeled by damaging weather. Canadian wheat production is expected to sink to a 14-year low. Corn edged lower, while soybeans were little changed.