BLBG:Wheat Heads for First Weekly Decline in Four as USDA Sees Record Supply
Wheat slumped for a fourth day, heading for the first weekly drop in four, after the U.S. Department of Agriculture predicted that world stockpiles would climb to a record. Corn and soybeans also declined.
March-delivery wheat fell as much as 1.2 percent to $6.3825 a bushel, the lowest level since Jan. 30, on the Chicago Board of Trade and was at $6.4025 by 11:33 a.m. in Tokyo. The contract lost 2.2 percent yesterday, the biggest drop since Jan. 12. Futures are set for a 3.1 percent decline this week.
Inventories on May 31, before the next harvest, will climb to 213.1 million metric tons, 1.5 percent more than estimated last month, the USDA said yesterday. Analysts surveyed by Bloomberg had expected a drop. Wheat prices are down 26 percent in the past year as countries including India and Australia produce record crops, helping send global food costs down 9.9 percent from a record last February.
“USDA data on global wheat stockpiles was a bit surprising,” said Hiroyuki Kikukawa, general manager for research at IDO Securities Co. in Tokyo. Prices may remain under pressure unless demand increases significantly, he said.
Rising supplies may ease concern that months of dry weather in eastern Europe and subzero temperatures in the past week have damaged dormant winter crops. More wheat available for livestock feed may also reduce demand for tighter corn stockpiles. The USDA yesterday lowered its forecasts for global corn and soybean inventories.
Corn Declines
U.S. corn inventories may total 801 million bushels before this year’s harvest, less than estimated last month while still 1.9 percent more than expected in a Bloomberg survey. Global stockpiles at 125.35 million tons were bigger than expected, even after the USDA cut its outlook for Argentina’s crop to 22 million tons, 15 percent less than forecast in January.
Corn for March delivery slid 0.5 percent to $6.3375 a bushel. The price has declined 1.7 percent this week. March- delivery soybeans fell 0.6 percent to $12.205 a bushel, dropping for a fourth day.
In Brazil and Argentina, the two biggest soybean producers after the U.S., output will fall to a three-year low of 120 million tons, the USDA said. U.S. exports will drop 15 percent in the marketing year that ends Aug. 31, the USDA said, unchanged from last month’s estimate. China, the biggest buyer, is projected to import 55.5 million tons this year, down from 56.5 million estimated in January.
To contact the reporter on this story: Jae Hur in Tokyo at jhur1@bloomberg.net
To contact the editor responsible for this story: Richard Dobson at rdobson4@bloomberg.net
