Wheat futures slumped to a five-month low on speculation that the earthquake in Japan and protests in the Middle East will cut global demand.
Twelve dry-cargo ports in Japan, the second-biggest buyer of U.S. wheat, were damaged and still shut yesterday following the March 11 quake and tsunami, Inchcape Shipping Services said. Four people died today during protests in Bahrain. Riots over high food costs and corruption have spread across the Middle East and northern Africa, toppling leaders in Tunisia and Egypt, the world’s biggest wheat buyer.
“We’ll keep one eye on Japan, one eye on the Middle East and one eye on the equity markets,” said Dan Kuechenmeister, the manager of the commodities department at RBC Dain Rauscher in Minneapolis. “We need to be a three-eyed monster.”
Wheat futures for May delivery fell 5.75 cents, or 0.9 percent, to settle at $6.62 a bushel at 1:15 p.m. on the Chicago Board of Trade. Earlier, the prices touched $6.56, the lowest since Oct. 6.
The U.S. is the world’s largest exporter, and Nigeria is its biggest customer. Wheat was the fourth-biggest U.S. crop in 2010 at $13 billion, behind corn, soybeans and hay, government data show.