Wheat Advances for a Third Day on Deteriorating Crop Conditions in U.S.
Wheat rose for a third day in Chicago as worsening winter-crop conditions in the U.S., the largest exporter, and delayed spring-crop plantings fueled supply concerns amid strengthening demand.
About 38 percent of the winter-wheat crop was in poor or very poor condition as of April 17, up from 36 percent a week earlier and 6 percent a year earlier, the U.S. Department of Agriculture said yesterday. Dry weather in the past week from central Kansas to Texas hurt crops. About 5 percent of the spring-wheat crop was sown, against 18 percent a year earlier and the prior five-year average of 12 percent, the USDA said.
“Wheat prices rose sharply on the news of the slow spring- wheat planting and on the further news that the condition of the current winter-wheat crop is really quite bad,” economist Dennis Gartman said in his daily Gartman Letter.
Wheat for July delivery gained 12.75 cents, or 1.6 percent, to $8.235 a bushel by 10:54 a.m. London time on the Chicago Board of Trade. Prices reached a one-week high of $8.2475 after jumping 3.9 percent yesterday. Milling wheat for May delivery traded on NYSE Liffe in Paris climbed 6.25 euros, or 2.5 percent, to 252.25 euros ($360.01) a metric ton.
Wheat output in Texas, the fifth-largest U.S. grower, may plunge 61 percent to 50 million bushels as the dry spell damages plants and farmers abandon fields, said Mark Welch, a grain- marketing economist at Texas A&M University. About 68 percent of the Texas winter-wheat crop was in poor to very poor condition, the USDA said yesterday.
Lowest Since 2006
Yields in the U.S. may drop to 38 or 39 bushels an acre, the lowest since 2006, without improved weather conditions, said Dennis Delaughter, owner of Progressive Farm Marketing Inc. in Edna, Texas. The national yield has been below 40 bushels only twice in the past 13 years, USDA data show.
Wheat inspected for export at U.S. ports rose 24 percent from a week earlier to 35.7 million bushels in the week to April 14, the USDA said yesterday.
Corn for July delivery rose for a second day in Chicago, advancing 1.75 cents, or 0.2 percent, to $7.6125 a bushel. Sowing of the grain in the U.S., the largest grower and exporter, fell behind last year’s pace.
About 7 percent of the corn crop was planted as of April 17, down from 16 percent a year earlier, the USDA said yesterday. At least a third of the crop should be sown by May 1 or yield potential may be diminished, said Greg Grow, director of agribusiness for Archer Financial Services Inc. in Chicago.
Soybeans for July delivery fell 2.5 cents, or 0.2 percent, to $13.5325 a bushel after two advances in a row. China’s soybean crushers canceled more than 10 cargoes of the oilseed this month to cut growing losses for processing, state- affiliated researcher Grain.gov.cn said in a report today.
Crushers have also delayed shipments of more than 20 cargoes, it said. The cancellations and delays will likely lower China’s imports in the year through Sept. 30 to about 53 million tons, compared with 57 million tons estimated by the USDA, the researcher said. The Asian country is the world’s biggest soybean importer.
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