Wheat Futures Decline to One-Week Low on Dollar’s RallyMegan Durisin
Wheat futures fell to a one-week low as the dollar’s rally eroded the appeal of exports from the U.S., the world’s largest shipper. Corn and soybean prices rebounded.
The greenback rose to a five-year high against a basket of 10 currencies, and the Bloomberg Commodity Index of 22 raw materials extended a slump to the lowest since July 2009. Wheat helped pace the drop in agriculture prices. In its latest tender, Egypt, the top importer, bought French and Ukrainian grain.
“I don’t think you have to look any further than the dollar” to explain the futures slump, Brian Grete, editor of the Professional Farmers of America newsletter in Cedar Falls, Iowa, said in a telephone interview. “Everybody grows wheat around the world. There’s way more competitors from an export standpoint.”
Wheat futures for December delivery dropped 1.1 percent to close at $5.2475 a bushel at 1:15 p.m. on the Chicago Board of Trade. Earlier, the price touched $5.1875, the lowest for a most-active since Oct. 27.
The U.S. will account for 16 percent of global wheat exports this season, compared to at least 39 percent of world corn and soybean shipments, according to USDA forecasts. That means a stronger dollar has a greater impact on wheat futures, Grete said.
Corn futures for December delivery rose 1.6 percent to $3.7025 a bushel, the largest advance in a week. Earlier, the price dropped as much as 1.5 percent to $3.59, the lowest since Oct. 27. Trading was 41 percent above the 100-day average, according to data compiled by Bloomberg.
Soybean futures for January delivery climbed 0.9 percent to $10.1925. Earlier, the price fell as much as 1.4 percent to $9.9525, the lowest since Oct. 27.
This year, soybeans have dropped 21 percent, wheat fell 13 percent and corn declined 12 percent.
The U.S. Department of Agriculture has forecast that domestic corn and soybean output will rise to a record this year, while global wheat production heads to an all-time high.