BLBG:Wheat Declines As Rain In Russia, Australia Boosts Crop Outlook
Wheat declined on speculation that rain in parts of Russia and Australia, the world’s second biggest exporter, may boost production. Soybeans advanced.
Wheat for July fell as much as 1.1 percent to $6.7225 a bushel on the Chicago Board of Trade and was at $6.7375 at 10 a.m. in Singapore, posting a 3.1 percent gain this year.
Rain may fall in areas of southern Russia from tomorrow, according to AccuWeather Inc. Between 10 millimeters (0.4 inches) and 50 millimeters of rain fell in Australia’s eastern grain-growing regions in the week ended May 28, according to the nation’s Bureau of Meteorology. Australia is the world’s second- largest wheat shipper and Russia is the fourth-biggest, according to the U.S. Department of Agriculture.
“Recent rainfall in southern Russia and eastern Australia has helped ease wheat production worries,” Luke Mathews, a commodity strategist at Commonwealth Bank of Australia (CBA), wrote in a note today. Markets were closed yesterday for Memorial Day.
Wheat has gained 2.9 percent in May, snapping two months of declines, on concerns that dry weather from the U.S. to Australia may curb global supplies. Rainfall has been below- normal from Texas to Ohio in the past 14 days, QT Weather said in a report yesterday. Ukraine and Russia, accounting for 11 percent of world output, have endured drought conditions for three months, University College London data show.
The USDA may cut its global wheat crop estimate by 1.2 percent next month, the biggest drop in a June report since 2003, according to the average of 18 analyst estimates compiled by Bloomberg.
Soybeans for July delivery gained as much as 0.8 percent to $13.93 a bushel, the highest since May 22, and traded at $13.8925. Prices have climbed 15 percent this year after dry weather damaged crops in South America.
July-delivery corn advanced as much as 0.5 percent to $5.815 a bushel and traded at $5.8025. Prices are set to decline 8.5 percent this month, the third successive such drop, taking this year’s loss to 10 percent.
To contact the reporter for this story: Phoebe Sedgman in Melbourne at psedgman2@bloomberg.net
To contact the editor responsible for this story: James Poole at jpoole4@bloomberg.net
