Wheat futures in Chicago and Kansas City fell the most in two months after a government report showed warm, wet weather boosted crop conditions from Texas to Illinois.
About 59 percent of the winter-wheat crop in Kansas, the biggest U.S. grower, was in good or excellent condition as of March 25, up from 31 percent a year earlier, the U.S. Department of Agriculture said yesterday. Texas wheat was 39 percent rated in the top two categories, up from 11 percent last year, and Oklahoma crops rated good or excellent rose to 75 percent from 21 percent a year ago. Illinois wheat was rated 78 percent good or excellent.
“It looks like it will be one of the best U.S. crops in the last 10 years,” Jeff Beal, a market analyst at the Gulke Group Inc. in Rockford, Illinois, said in a telephone interview. “The weather has been very favorable for wheat development.”
Wheat futures for May delivery slumped 3 percent to close at $6.3975 a bushel at 1:15 p.m. on the Chicago Board of Trade, the biggest drop since Jan. 12. The grain has fallen 12 percent in the past year as rising world production will boost reserves before the start of the Northern Hemisphere harvest season to the highest since 2000.
On the Kansas City Board of Trade, wheat futures for July delivery retreated 2.7 percent to settle at $6.885 a bushel, the biggest drop since Jan. 18.
Wheat is the fourth-biggest U.S. crop, valued at $14.4 billion in 2011, behind corn, soybeans and hay, government data show.
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