Wheat futures extended gains in Chicago on speculation Russia will restrict exports after the worst drought in at least 50 years curbed production. Russian officials are discussing possible grain export restrictions as traders urge a blanket ban rather than duties to allow them to renege on contracts, said Grain Union President Arkady Zlochevsky. Russia’s Agriculture Ministry spokesman Oleg Aksyonov declined to comment. The wheat market “is running purely on fear,” Jonathan Barratt, managing director at Commodity Broking Services Pty, said by phone today from Sydney. “We need to clarify how concerning” the supply situation is, he said. Wheat for September delivery were at the high of the day, up 3.5 percent at $7.04 a bushel in Chicago by 12:24 p.m. London time. Prices have climbed 6.4 percent this month, after rallying 38 percent last month, the most since 1973. Milling wheat futures for November delivery in Paris climbed as much as 2.9 percent to 210.25 euros ($278) a metric ton. Firefighters in Russia are battling 520 blazes that cover 188,525 hectares (728 square miles), according to the Emergency Situations Ministry. Russia’s wheat crop in the season that began July 1 will be 19 percent smaller than a year earlier and exports will drop 23 percent, the U.S. Department of Agriculture’s Foreign Agricultural Service said this week. The Russian government must temporarily ban exports, allowing companies to cancel contracts because the drought may cause a domestic grain shortage, Nikolai Demyanov, deputy chief executive officer of International Grain Co., a unit of Glencore International AG, said yesterday. Rice for November delivery gained 2.7 percent to $11.32 per 100 pounds in Chicago. Prices earlier climbed to $11.35, the highest for a most-active contract since June 2. Corn for December delivery added 0.9 percent to $4.0775 a bushel. November-delivery soybeans jumped 0.4 percent to $10.22 a bushel. To contact the reporters on this story: Luzi Ann Javier in Singapore at ljavier@bloomberg.net

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