Wheat futures jumped to a one-month high as commodities rallied after the Federal Reserve announced a third round of monetary measures to bolster the U.S. economy.
The Fed said yesterday it would make additional debt purchases in a third round of so-called quantitative easing. The Standard & Poor’s GSCI Spot Index of 24 raw materials rose to a five month high. Wheat has surged 42 percent this year after a U.S. Midwest drought scorched corn crops, reducing supplies of grain used to make livestock feed.
“The markets are feeding off the QE3,” Mike Zuzolo, the president of Global Commodity Analytics & Consulting in Lafayette, Indiana, said by telephone. “This kicks in some money from the funds that will increase their exposure to the wheat complex.”
Wheat futures for December delivery rose 2.5 percent to settle at $9.2425 a bushel at 2 p.m. on the Chicago Board of Trade. Earlier, the price reached $9.31, the highest for a most-active contract since Aug. 10. This week, the grain advanced 2.1 percent, the third straight increase.
The U.S. is the world’s top wheat exporter. The grain is the nation’s fourth-largest crop, valued at $14.4 billion in 2011, behind corn, soybeans and hay, government data show.