Wheat Gains as U.S. Winter Crop Worsens and Black Sea Stays DryLuzi Ann Javier and Rudy Ruitenberg
Wheat climbed in Chicago after winter-crop conditions worsened in the U.S., the largest exporter, and as a lack of rain in the Black Sea region raised concerns production there will be affected.
U.S. winter wheat was rated good to excellent for 32 percent of the crop as of May 5, down from 33 percent the previous week and compared with top ratings for 63 percent a year earlier, according to the U.S. Department of Agriculture.
The crop report “confirms conditions that are not very satisfactory because one has to go back to 1996 to find a level as low,” Paris-based farm adviser Agritel wrote in a comment.
Wheat for delivery in July added 0.5 percent to $7.0625 a bushel by 7:44 a.m. on the Chicago Board of Trade, after sliding 3.5 percent in the prior two sessions. Volume was 41 percent below the 100-day average for that time of day. Milling wheat for delivery in November traded on NYSE Liffe in Paris rose 0.5 percent to 210.25 euros ($275.62) a metric ton.
Dry conditions are increasing across southeastern Ukraine and southwestern Russia, stressing winter wheat and hampering spring-crop sprouting, MDA Information Systems LLC reported yesterday. Higher temperatures accelerated soil drying, and weather is expected to be dry and “very warm” in the region this week, the forecaster said.
“The lack of precipitation in the Black Sea region is worrying the farmers more and more,” Agritel wrote. “Sowing is currently done in the dry, which raises doubts about the implementation of the crops.”
In the U.S., some 23 percent of spring wheat was planted as of May 5, behind last year’s 82 percent pace and an average of 50 percent in the previous five years, the USDA said yesterday.
“The USDA’s weekly crop progress report showed a further deterioration in the U.S. winter-wheat crop conditions and underlined the slow pace of spring wheat seeding,” Luke Mathews, a commodity strategist at Commonwealth Bank of Australia, wrote in a report e-mailed today.
Corn for delivery in July was little changed at $6.37 a bushel in Chicago. Planting in the U.S., the largest grower of the grain, was 12 percent complete in the week ended May 5, the slowest pace for that week since 1984, according to the USDA.
The rate of planting “should ensure production concerns remain a feature of the corn market over the next week or so,” Mathews said.
Soybeans for delivery in July rose 0.5 percent to $13.755 a bushel. About 2 percent of the crop was seeded, trailing the average of 12 percent for that week in the previous five years, a USDA report showed.