Wheat Advances a Third Day as Cold Weather Threatens U.S. SupplyWhitney McFerron and Luzi Ann Javier
Wheat rose for a third day in Chicago, set for the longest winning streak since November, as cold weather in the U.S. added to concerns over global supply already cut by higher feed use. Soybeans dropped.
Temperatures in parts of the wheat belt in the U.S., the world’s largest exporter of the grain, will turn lower over the next week, especially in northern and eastern areas, DTN said in a forecast yesterday. The winter-wheat crop, dormant since November, was already in the worst shape since record-keeping began in 1985.
“The uncertainty in the prospects of the U.S. wheat crop may induce more volatility in the market, skewed slightly” to the bullish side, Joyce Liu, an analyst at Phillip Futures Pte in Singapore, said in a report today. “Weather concerns include the lack of snow-cover, leaving the wheat crop exposed.”
Wheat for delivery in March added 0.7 percent to $7.725 a bushel at 7:02 a.m. on the Chicago Board of Trade. The most-active contract advanced 19 percent last year. In Paris, milling wheat for the same delivery month rose 0.5 percent to 250.75 euros ($333.87) a metric ton on NYSE Liffe.
Global inventories will drop 9.8 percent to a four-year low of 176.6 million tons before the 2013 Northern Hemisphere harvest, below the 176.95 million tons forecast in December, the U.S. Department of Agriculture said Jan. 11. Winter-wheat growing areas in the U.S. Great Plains from Texas to North Dakota are experiencing drought conditions, the U.S. Drought Monitor shows.
Corn for delivery in March rose 0.3 percent to $7.26 a bushel in Chicago, heading for a seventh straight gain. Soybeans for delivery in the same month advanced 0.9 percent to $14.3025 a bushel after climbing the most since July yesterday.
Topsoil moisture conditions may decline in Argentina and parts of southern Brazil, Commodity Weather Group said today in an e-mailed report. Central Argentina may have some scattered showers by Jan. 17 and another weak storm system may arrive late next week. At least a quarter of Argentina’s corn and soybean areas may have “minor stress” and more rain will be needed in early February, according to the report.