Wheat traded near an eight month-low as a second major snowstorm brings relief to a U.S. winter crop that was in its worst shape since at least 1985 when it went dormant in November.
The contract for May delivery traded little changed at $7.055 a bushel on the Chicago Board of Trade at 10:20 a.m. Singapore time, after slumping as much as 2.1 percent yesterday to $7.04, the cheapest level for futures since June 25.
About 23 percent of the winter-wheat crop in Kansas, the largest U.S. grower of the variety, was rated good-to-excellent by Feb. 24, up from 20 percent at end-January as snow boosted moisture, the U.S. Department of Agriculture said yesterday. More than a foot (30 centimeters) of snow was expected in parts of the southern Great Plains, four days after a storm brought as much as 20 inches, National Weather Service data show.
“Heavy snow throughout the hard red winter wheat belt last night, which complements last week’s snowfall, is providing another significant improvement in soil moisture, helping alleviate existing drought conditions,” Luke Mathews, a commodity strategist at Commonwealth Bank of Australia (CBA), wrote in a report. “The bulls have seemingly given up on wheat prices over the past week, yet appetite could quickly return.”
Corn for May delivery gained 0.2 percent to $6.8675 a bushel in Chicago, while soybeans rose 0.3 percent to $14.40 a bushel. That puts the price of soybeans at 2.10 times the cost of corn, compared with a 10-year average of 2.43 times. The crops compete for acreage.
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