Soviets Spark Rally in Grain
The Soviet Union’s announcement Friday that it will fulfill its agreement to buy 1.1 million tons of wheat triggered a rally in grain and soybean prices on the Chicago Board of Trade.
Traders had feared that the Soviets would not meet their long-term agreement with the United States. But Friday’s announcement “just kind of set the wheat market on fire and spilled over into all the other markets,” said Dale Gustafson, a grains analyst with Drexel Burnham Lambert.
“Other than that, it was a lackluster day” marked by quiet pre-Labor Day trading, he said.
The markets rallied earlier in the session because of lighter-than-expected deliveries on the September grain and soybean contracts Friday, the first delivery day, analysts said.
Corn’s advances were tempered by low demand, Gustafson said, and the U.S. dollar’s rally also helped offset gains.
Crude oil and heating oil prices advanced while leaded gasoline was mixed in trading on the New York Mercantile Exchange.
Algeria’s announcement that it had suspended until Sept. 21 all shipments of gasoil--the European equivalent of heating oil--supported heating oil prices, said Peter Beutel, an analyst with Rudolf Wolff Energy.
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