BLBG:Wheat Advances as Price Drop Stokes Demand for U.S. Supplies
Wheat rose in Chicago, narrowing a fourth weekly drop, on indications the lowest prices for the grain in seven months stoked demand for the U.S. crop.
Total net export sales of wheat more than doubled to 706,252 metric tons in the week ended Feb. 7 from the prior period, U.S. Department of Agriculture figures showed yesterday. Egypt, the world’s biggest wheat importer, bought U.S. grain in both of the tenders it’s held so far this year.
“U.S. wheat is now the cheapest in the world, and that supports export sales there,” Erin FitzPatrick, a London-based analyst at Rabobank International, said by phone today.
Wheat for delivery in May advanced 0.6 percent to $7.45 a bushel on the Chicago Board of Trade by 10:49 a.m. London time. Prices are down 1.5 percent this week and reached $7.225, the lowest level since June, on Feb. 13. Milling wheat for delivery in May traded on NYSE Liffe in Paris rose 0.6 percent to 238 euros ($317) a ton.
Prices declined 4.2 percent this year in Chicago on speculation that rains in some growing areas in the U.S. may aid crop development as the largest shipper recovers from the worst drought since the 1930s. Corn retreated for 10 sessions in a row through yesterday, the longest run of declines since 1965, and soybeans are set to fall for a second week.
“We’ve seen a pretty big selloff across the entire complex over the past week which we think, based on the still-tight supply situation, was overdone, particularly given feed demand in the U.S. still remaining very strong,” FitzPatrick said. “We are seeing a bit of a recovery.”
Corn for delivery in May gained 0.8 percent to $6.98 a bushel in Chicago. The grain is little changed this year, paring an increase of as much as 6.9 percent.
Soybeans for delivery in May added 0.4 percent to $14.145 a bushel. The oilseed was set for a 2.6 percent weekly slide.
To contact the reporters on this story: Chanyaporn Chanjaroen in Singapore at cchanjaroen@bloomberg.net; Marina Sysoyeva in Moscow at msysoyeva@bloomberg.net
To contact the editors responsible for this story: James Poole at jpoole4@bloomberg.net; Claudia Carpenter at ccarpenter2@bloomberg.net
