This post was originally published on The Economic Times
PARIS/JAKARTA – U.S. and European wheat futures rose to fresh multi-month highs on Friday as investor concerns about the risk of a U.S.-Iran military conflict supported short-covering before the weekend. Soybeans edged up to trade near a 20-month peak, with the oilseed also supported by expectations of more export and biofuel demand.
Commodities market have been unsettled as investors fret about inconclusive talks on Thursday between Washington and Tehran, despite mediator Oman’s talk of progress. Other markets are taking cues from crude oil, which rose 2%. The most-active wheat contract on the Chicago Board of Trade (CBOT) was up 1.8% at $5.84-3/4 a bushel. It earlier reached its highest since late June at $5.85-3/4, slightly above a previous eight-month top hit on Monday.
On Euronext, May wheat added 1.8% to 201.25 euros ($237.56) per metric ton, its highest since early November, after breaching the 200-euro chart resistance level. News that China has advised its citizens to avoid Iran due to the security situation also unsettled markets, traders said. “Uncertainty around the Iranian situation continues to generate a risk premium on prices,” Argus Media analysts said.
“Geopolitics remains a
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