FINANCIAL MARKETS : Commodities : Grain Prices Rise in Wake of New U.S. Sales to Soviets

Grain and soybean futures prices closed higher Wednesday on the Chicago Board of Trade, with wheat prices up strongly following the White House announcement of additional subsidized grain sales to the Soviet Union.

On other markets, cotton prices rose, energy futures were mostly higher, livestock futures were up and pork futures were mixed. Precious metals also were mixed.

Wheat settled 1 cent to 11 cents higher, with the contract for May delivery at $4.37 1/2 a bushel; corn was 1/2 cent to 2 1/2 cents higher, with May at $2.76 a bushel; oats were 1/2 cent to 2 3/4 cents higher, with May at $1.87 cents a bushel, and soybeans were 6 cents to 12 3/4 cents higher, with May at $7.46 3/4 a bushel.

Wheat opened lower at the start of trading, surprising a market that expected a strong start for wheat futures.

“There were a lot of people who thought the Russian business was already reflected in prices,” said Rich Feltes, an analyst with Refco Inc. in Chicago. “Today’s action showed that any kind of business outside the United States will be positive” for the market.

The Bush Administration announced Tuesday that the United States will sell 1.5 million metric tons of wheat to the Soviet Union under the export bonus program.

Cotton futures prices rose sharply on New York’s Cotton Exchange on reports of severe damage to the Soviet Union’s cotton crop.

The rally also was stimulated by commission house and local buying, said Ernest Simon, a cotton specialist for Prudential-Bache Securities Inc. in New York.

The Soviet news agency Tass reported that the Central Asian Republic of Uzbekistan suffered losses in crops and livestock following four days of heavy rain and snow.

Cotton settled 1.04 cents to 1.33 cents higher, with May at 66.33 cents a pound.

Energy futures were mostly higher on the New York Mercantile Exchange as gasoline prices came under pressure in the wake of an American Petroleum Institute report of increased imports.

West Texas Intermediate crude oil was 30 cents to 49 cents higher, with June at $20.10 a barrel; heating oil was 1.34 cents lower to 0.41 cent higher, with June at 47.86 a gallon, and unleaded gasoline was 1.86 cents lower to 0.89 cent higher, with June at 69.39 cents a gallon.

Livestock prices were higher and pork futures were mixed on the Chicago Mercantile Exchange.

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