Wheat gained the most this week on speculation that U.S. cattle producers will use more of the grain in feed rations amid rising corn prices and after Egypt today said it filled a tender exclusively from U.S. inventories.
Before today, wheat futures in Chicago lost 2.1 percent this year, and the price in Kansas City has declined 5.3 percent. Corn, the main ingredient in livestock feed, rose 1.6 percent. Some cattle feeders have said they will add wheat to rations by July, said Tom Leffler, the owner of Leffler Commodities LLC in August, Kansas. Egypt said it bought 115,000 metric tons of the grain from the U.S.
“There’s definitely a little more push toward feeding wheat,” Jon Marcus, the president of Lakefront Futures and Options LLC in Chicago, said in a telephone interview. “This could be a proactive move on Egypt’s part. We’ll probably see more and more buying on these price dips.”
Wheat futures for May delivery gained 0.3 percent to $6.4125 a bushel at 9:54 a.m. on the Chicago Board of Trade. The U.S. is the world’s largest exporter and Egypt is the biggest importer of the grain.
The price has declined this year on forecasts from the U.S. Department of Agriculture that global stockpiles will rise 5.1 percent to a record 209.6 million tons by the end of the season on May 31.