BLBG:Wheat Trades Near Seven-Month Low Amid U.S. Rainfall Speculation
Wheat traded near a seven-month low in Chicago on speculation rains in the U.S. will help the crop in the biggest exporter recover from the worst drought since the 1930s. Corn headed for the longest losing streak since 1980.
Parts of the central and southern plains may have some rain next week, forecaster DTN said in a report yesterday. Rainfall is needed to prevent significant stress during spring, it said. The U.S. winter-wheat crop was in the worst shape since at least 1985 when it went dormant in November.
“The weather situation is certainly getting better because rainfall will improve next season’s wheat yield,” Andrey Kryuchenkov, a London-based commodity strategist at VTB Capital, said by phone today. Prices also slid on investors’ expectations of larger ending stockpiles next season, he said.
Wheat for delivery in March dropped 0.7 percent to $7.27 a bushel on the Chicago Board of Trade by 10:11 a.m. London time. Yesterday prices reached $7.255, the lowest level for a most- active contract since June 26. Milling wheat for delivery in May traded on NYSE Liffe in Paris lost 1.4 percent to 233.25 euros ($314.39) a metric ton.
Kryuchenkov predicted further declines to “a certain consolidation level at just above $7.20 a bushel.”
Corn for delivery in March headed for a ninth straight drop in Chicago, sliding 0.4 percent to $6.9325 a bushel. A lower close would match a streak of declines that ended on Dec. 11, 1980, according to data compiled by Bloomberg.
Acreage Competition
Soybeans for delivery in May dropped 0.4 percent to $14.035 a bushel. The oilseed cost 2.02 times more than corn, compared with an average of 2.4 times in the past decade. The crops compete for acreage.
In Brazil, poised to become the world’s second-largest corn shipper, scattered showers and thunderstorms will aid crops in southern areas this week, DTN said.
The U.S. Department of Agriculture cut its estimate for the country’s exports of corn this year to 22.86 million tons on Feb. 8 from 24.13 million tons a month earlier. Lower shipments will boost global inventories of the grain to 118.04 million tons from 115.99 million tons forecast in January, it said.
To contact the reporter on this story: Marina Sysoyeva in Moscow at msysoyeva@bloomberg.net
To contact the editors responsible for this story: Claudia Carpenter at ccarpenter2@bloomberg.net
