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By Julie Gingersen
CHICAGO, USA, Sept 22 (Reuters) – US wheat futures hit a two-month high on Thursday, buoyed by the threat of an escalating conflict in Ukraine combined with dry weather in Argentina’s growing regions and the plains of the United States, said dealer.
* By 1743 GMT, Chicago December wheat was up 13.25 cents at $9.17 a bushel after hitting $9.2250, the highest since July 11.
* Corn futures trailed wheat while soybeans fell. Corn in December rose 5 cents to $6.9050 a bushel and soybeans in November fell 1.25 cents to $14.60 a bushel.
* Wheat futures were spared the pressures of a rising dollar which tends to make US grains less competitive, disappointing weekly US export sales and rising International Grains Council global wheat production forecasts for 2022/23.
* Traders instead seemed to focus on fears of further disruption to grain trade in the Black Sea, which has been partially restored by a shipping corridor from Ukraine. President Vladimir Putin on Wednesday ordered a Russian mobilization to fight in Ukraine and indicated he was ready to use nuclear weapons.
* “It’s mostly about Russia and Ukraine and what’s going on there,” said Jack Scoville, an analyst at Price Futures Group in Chicago, of wheat’s strength.
* Meanwhile, Argentina’s grain exchange Rosario lowered its production forecasts for the country’s wheat and corn crop on Wednesday due to the impact of a prolonged drought that supported prices.
* Drought conditions prevail in the southern plains of the United States, where farmers are planting the 2023 winter wheat crop. A US Drought Monitor report showed “extreme drought” in 53% of Kansas, the state with the highest winter wheat production in the US. down 42% a week earlier.
* Trading in corn and soybean futures was subdued as traders awaited the results of the US crop for both crops, which had just started in the Midwest’s harvest belt.
* Macro concerns weighed on markets a day after the US Federal Reserve raised interest rates for the third time, as expected, by 75 basis points. (Additional reporting by Gus Trompiz in Paris and Enrico Dela Cruz in Manila Edited in Spanish by Javier Leira)