Wheat futures fell for the second straight day after France raised its forecast for inventory by 17 percent from a December estimate.
France will have 2.29 million metric tons of soft wheat in storage on June 30, up from 1.96 million tons forecast last month, FranceAgriMer said today. The price in Chicago has plunged 14 percent since the end of November, partly on expectations for larger global stockpiles.
“The French farm office raised their ending stocks for wheat and maize,” driving prices down, Mike Zuzolo, the president of Global Commodity Analytics in Lafayette, Indiana, said in an e-mail.
Wheat futures for March delivery slid 0.7 percent to settle at $7.455 a bushel at 2 p.m. on the Chicago Board of Trade. The price dropped 0.1 percent yesterday.
In 2012, the grain rose 19 percent, the most among 24 raw materials in the Standard & Poor’s GSCI Spot Index.
Investment funds tracking commodity measures may be selling agriculture holdings as weightings shift for the GSCI and Dow Jones-UBS gauges, Louise Gartner, the owner of Spectrum Commodities in Beavercreek, Ohio, said in a telephone interview.
“The index funds are rebalancing, which includes selling a lot of Chicago wheat,” she said. “There’s been huge fund liquidation over the last month, but the first of the year is mostly index-fund portfolio rebalancing.”
Wheat is the fourth-largest U.S. crop, valued at $14.4 billion in 2011, behind corn, soybeans and hay, government data show.