BLBG: Wheat, Little Changed, May Fall for Second Day as Stocks Expand
By Jae Hur
Dec. 22 (Bloomberg) -- Wheat, little changed in Chicago, may fall for a second day on speculation that rising global stockpiles and production will reduce demand for U.S. supplies. Soybeans climbed for the first time in four days.
Wheat prices have dropped 12 percent this month, the first such decline since September. Global stockpiles may jump 17 percent to 190.9 million metric tons by May 31, the U.S. Department of Agriculture said Dec. 10. World output may total 673.9 million tons, second only to last year’s record of 682 million tons, the USDA estimates.
“Healthy global wheat production, substantial global stockpiles and tepid demand for U.S. exports will continue to limit the upside for Chicago wheat prices,” said Toby Hassall, a research analyst at CWA Global Markets Pty in Sydney.
Wheat for March delivery rose 0.1 percent to $5.2025 a bushel in electronic trading on the Chicago Board of Trade at 12: 01 p.m. Paris time after losing 1.6 percent yesterday. The grain has declined 15 percent this year, heading for a second straight annual loss.
U.S. exporters shipped 11.8 million tons of the grain from June 1 through Dec. 10, down 30 percent from the same period a year earlier, government data show.
Milling wheat for January delivery traded on Liffe in Paris fell 0.4 percent to 128.75 euros ($184.27) a metric ton.
The market “remains difficult, taking into account the outlook,” French farm adviser Agritel said in a market comment today. “Without weather incidents for the 2010 harvest, the world will have to absorb major stocks.”
Corn, Soybeans
Corn for March delivery in Chicago was up 0.1 percent at $4.0025 a bushel. March-delivery soybeans climbed 0.5 percent to $10.1375 a bushel. The oilseed fell 5.5 percent the past three days.
Soybeans reached $10.0725 yesterday, the lowest price since Nov. 17, on speculation that rain will boost yields in Brazil and Argentina, the biggest producers and exporters of the oilseed behind the U.S.
“The outlook for soy futures is increasingly bearish as the trade eyes the approach of a bumper South American harvest,” Hassall said.
The USDA says soybean production in Brazil and Argentina slipped to 89 million tons this year, down 17 percent from 2008. Output in 2010 may rise 30 percent to 116 million tons, the department said in a Dec. 10 report.
China’s soybean imports rose 10.6 percent in the January- to-November period to 37.8 million tons, according to data from the Beijing-based Customs General Administration.
To contact the reporter on this story: Jae Hur in Tokyo at jhur1@bloomberg.net
