Wheat Rebounds from 2-Month Lows

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The following article is from Bloomberg:

Wheat Rebounds From Two-Month Low as U.S. May Boost Export Sales

By Whitney McFerron

Wheat futures rebounded from a two- month low amid signs that demand for U.S. exports is increasing.

Egypt, the world’s largest importer, bought 115,000 metric tons from the U.S. in a tender, the government in Cairo said. Iraq, Morocco and the United Arab Emirates also have issued buying tenders. Grains plunged yesterday as escalating unrest in the Middle East and North Africa threatened to curb demand. Wheat tumbled as much as 17 percent since Feb. 14, when the price reached the highest since August 2008.

“End-users are getting an opportunity that one week ago you wouldn’t have thought you’d get to see,” said Jason Britt, the president of Central States Commodities Inc., a broker in Kansas City, Missouri. “It’s going to start showing up in export tenders.”

Wheat futures for May delivery rose 2.5 cents, or 0.3 percent, to settle at $7.9825 a bushel at 1:15 p.m. on the Chicago Board of Trade. Earlier, the price touched $7.5675, the lowest since Dec. 22. Wheat has gained 58 percent in the past year after harvests were disrupted by drought in Russia and floods in Australia. The U.S. is the biggest exporter.


Yesterday, wheat, rice, corn and soybeans fell the most allowed by the CBOT as violence escalated in Libya, where protests have left as many as 300 people dead, according to Human Rights Watch. Leaders have been ousted this year in Tunisia and in Egypt, and unrest has spread to Yemen and Bahrain.

Rising commodity costs have pushed up global food prices, which jumped 25 percent last year and surged to a record in January, according to the United Nations. North Africa and the Middle East are expected to buy 39.4 million metric tons of wheat this year, or 32 percent of world purchases, U.S. Department of Agriculture data show.

Wheat was the fourth-biggest U.S. crop in 2010, valued at $13 billion, behind corn, soybeans and hay, government data show.

To contact the reporter on this story: Whitney McFerron in Chicago at wmcferron1@bloomberg.net.

To contact the editor responsible for this story: Steve Stroth at sstroth@bloomberg.net.

Source:  Bloomberg

Posted by Haylie Shipp

 

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