Wheat rose to a three-week high in Chicago on speculation that excessive rainfall in Australia will curb production and dry weather in the U.S. southern Great Plains may hurt newly planted crops.
More than half of the crop in Australia’s Queensland state may deteriorate to feed grade following heavy rains, tightening supplies of grain used to make food. Dry weather in parts of Kansas, Oklahoma and Texas, the largest U.S. growers of winter wheat, may deplete soil moisture and limit output. Futures jumped 7.2 percent yesterday, the most in seven weeks.
“There’s so many fundamentals related to weather, it has to support the market at least until the end of the year,” said Jonathan Bouchet, an analyst at OTCex Group in Geneva. “Wheat is one of the leading commodities as an investment today. Overall, commodities are quite bullish.”
Wheat for March delivery advanced 9.25 cents, or 1.3 percent, to $7.4925 a bushel at 1:14 p.m. London time on the Chicago Board of Trade. The grain reached $7.5175, the highest level since Nov. 11, and is up 7.9 percent in the past month. The U.S. is the world’s biggest wheat exporter.
Milling wheat for January delivery traded on NYSE Liffe in Paris climbed 2.2 percent to 234 euros ($307.87) a metric ton. The price has gained 11 percent since Nov. 22, the last time futures declined.
Corn for March delivery fell 3.25 cents, or 0.6 percent, to $5.63 a bushel in Chicago, and soybeans for January delivery declined 7 cents, or 0.5 percent, to $12.76 a bushel. Rice for January delivery added 6 cents, or 0.4 percent, to $14.435 per 100 pounds, the fourth straight gain.