Wheat futures advanced, paring the weekly decline, on concerns excessive rains in Canada may damage crops in the world’s third-largest exporter.
December-delivery wheat increased as much as 0.8 percent to $7.03 a bushel in Chicago Board of Trade before trading at $6.99 at 10:53 a.m. Singapore time, taking the weekly loss to 5.4 percent, the most for the most-active contract since May 14.
Harvests of crops including wheat, barley and canola in Saskatchewan, Canada’s biggest wheat-growing province, were 18 percent complete as of Sept. 20, behind the five-year average of 65 percent, because of “significant rainfall in most areas,” the government said in a report yesterday. Frost affected the growing areas on Sept. 17 and 18, it said.
“Rain potentially reduces the overall quality” of the grain, Michael Pitts, commodity sales director at National Australia Bank Ltd., said by phone from Sydney. “We may have disease problems as well.”
Corn for December delivery declined 0.5 percent to $4.97 a bushel in Chicago, and headed for a 3.1 percent loss this week.
Farmers in Argentina, the world’s second-largest corn exporter, will plant more than previously forecast this year as rains may increase yields for the next harvest, the Buenos Aires Cereals Exchange said yesterday.
The crop will cover 3 million hectares, more than the 2.93 million hectares predicted a week ago, the exchange said in its weekly report. About 13 percent of the area is planted, it said.
World corn stockpiles will tumble to a four-year low of 131 million tons at the end of 2010-2011, 4 million tons below last month’s forecast, on reduced estimates for output in the U.S. and Ukraine, the International Grains Council said yesterday.
The global crop will be a record 824 million tons, smaller than the 829 million tons predicted last month, the council said.
“Comparatively higher prices of feed-grade wheat and barley are expected to shift some demand to imported maize, especially in South Korea, the Philippines and Israel,” the council said, raising its estimate on corn use in livestock feeds by 6 million tons to 485 million tons.
November-delivery soybeans were little changed at $10.93 a bushel, taking the weekly gain to 2.3 percent.
To contact the reporter on this story: Luzi Ann Javier in Singapore at ljavier@bloomberg.net
[Bloomberg]
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