Wheat rose for the second time in three days as unusually heavy rain threatens crops in Argentina while dry weather erodes production prospects in Australia.
Storms in central Argentina followed by cold weather will slow development of wheat plants, and more cool weather is expected next week, forecaster Telvent DTN said in a report today. In Australia, little rain is expected in the next seven days, and wheat “will suffer” if precipitation doesn’t start falling soon, said Joel Burgio, a meteorologist with Telvent.
“Yields are worse than expected” in Argentina because of excessive rainfall, Jamey Kohake, a broker and branch manager at Paragon Investments in Silver Lake, Kansas, said by telephone. “The Australia weather forecast is drier than it was earlier this week.”
Wheat futures for December delivery climbed 2 percent to settle at $8.9725 a bushel at 2 p.m. on the Chicago Board of Trade. The price slumped 2.9 percent this week, partly on speculation that global demand will decline.
Australia was the world’s second-biggest exporter of wheat last year, behind the U.S. Argentina ranked fifth behind Russia and Canada.
Wheat is the fourth-largest U.S. crop, valued at $14.4 billion in 2011, behind corn, soybeans and hay, government data show.