Chicago Board of Trade (CBOT) wheat futures rose 2.4 per cent on Friday, rallying through key technical resistance amid signs of good export demand and worries about the health of the U.S. crop, traders said.
Soybean and corn futures also rose, with corn posting its fifth straight positive session and soybeans hitting a two-week high because of strong nearby demand from processors and slow farmer sales of old-crop supplies.
"The cash markets aren't going anywhere but up, with most interior corn and soy basis values already well ahead of year-ago levels and rising," Matt Zeller, director of research at INTL FCStone, said in a note to clients.
Demand in the cash market caused another round of bull spreading in futures, with gains in nearby soybeans and corn outstripping the new-crop contracts.
CBOT May soybeans settled up 11 cents at $14.13 a bushel; CBOT May corn was 7-1/4 cents higher at $6.58-1/2 a bushel.
For the week, corn futures rose 4.9 per cent while soybeans were up 3.6 per cent, their biggest weekly gain since August.
The benchmark CBOT May soft red winter wheat contract was up 17 cents at $7.14-3/4 a bushel. Prices rose two per cent this week and broke through the 30-day moving and 40-day moving averages on Friday.
Rising demand from livestock producers added further strength to soft red winter wheat prices, which were trading at a 40-cent-per-bushel discount to hard red winter wheat futures.
Analysts said some hard red winter wheat, which has struggled with dry soils since planting, was likely damaged during the last few days due to wintry conditions in the U.S. Plains.
Temperatures were seen falling into the -7 to -1 C range in parts of the hard red winter wheat region next week, said Don Keeney, meteorologist for MDA Weather Services. Cold soil temperatures could also delay seeding of the spring wheat crop in North Dakota.
Kansas City Board of Trade (KCBT) May hard red winter wheat futures were 14-1/4 cents higher at $7.53 a bushel. MGEX May spring wheat gained 18-1/4 cents to $8.07-3/4 a bushel.
"I think it is all about the cold weather in the southern Plains," said Mike Krueger, president of the Money Farm, a crop advisory service near Fargo, N.D. "Some reports are starting to filter in that maybe there will be more damage than people expected."
Chinese buying provided additional support for the wheat market.
China's largest purchase of U.S. soft red winter wheat in at least nine years was confirmed by the U.S. Agriculture Department on Thursday and should be followed by more big purchases this year as Beijing rebuilds depleted reserves. The country is seen taking advantage of cheap imports to meet its growing need for livestock feed, analysts and trade sources said.
-- Mark Weinraub covers the grain futures markets for Reuters in Chicago. Additional reporting for Reuters by Sam Nelson in Chicago.