BLBG: Wheat Has Longest Rally Since July on Demand for U.S. Exports
Wheat futures rose, capping the longest rally in six months, on signs that demand is increasing for U.S. supplies as adverse weather threatens global output.
Lebanon, Algeria, Tunisia and Bangladesh have issued tenders to buy wheat since Jan. 21. The U.S. is the world’s leading exporter. Prices have surged 68 percent in the past year as drought slashed output in Russia and Eastern Europe and floods in Australia and Canada eroded the quality of crops.
“We dominate the wheat export market,” said Jeff McReynolds, the owner of McReynolds Marketing & Investments in Hays, Kansas. “Russia has a ban, Ukraine has quotas, Europe has sold most of its exportable surplus and is not competitive anymore. Canada has quality issues, and Australia has quality issues plus infrastructure issues with getting the grain to port.”
Wheat futures for March delivery rose 3 cents, or 0.4 percent, to settle at $8.3825 a bushel at 1:15 p.m. on the Chicago Board of Trade, gaining for the sixth straight session, the longest rally since early July.
Today and yesterday, the price touched $8.395, the highest since Aug. 6. The most-active contract has climbed 5.5 percent this month.
Wheat is the fourth-biggest U.S. crop, valued at $10.6 billion in 2009, 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
