Wheat fell for a second day in Chicago after the grain’s climb to a four-month high yesterday encouraged investor to scale back their positions. Wheat for March delivery slid 1.8 percent to $7.705 a bushel on the Chicago Board of Trade at 12:54 p.m. Paris time. The price yesterday touched $8.11, the highest level for a most- active contract since Aug. 6. “The market was a bit overbought, and also it’s a correction ahead of the U.S. Department of Agriculture’s monthly reports,” Han Sung Min, a broker at Korea Exchange Bank Futures Co. in Seoul, said today by phone. On Dec. 10, the USDA may cut its forecast for world wheat inventories to 171.3 million metric tons, according to a Bloomberg News survey of 17 analysts. The agency predicted last month stockpiles on May 31 would total 172.51 million tons. The U.S. is currently forecast to be the largest wheat exporter, followed by France, Canada and Australia, based on estimates by the International Grains Council and French crops office FranceAgriMer. Wheat futures’ 14-day relative strength index, a gauge of whether a commodity is overbought or oversold, reached 72 on Dec. 6. Some analysts and traders who study technical charts view levels above 70 as signaling a potential impending drop. Milling wheat for January delivery traded on NYSE Liffe in Paris rose 0.4 percent to 233.25 euros ($308.89) a ton. Drought, Floods Wheat has jumped 60 percent in Chicago since the end of June as drought destroyed crops in Russia, floods harmed fields in Canada, and dry weather in the U.S. Great Plains reduced the outlook for winter plantings. “We should be buying wheat,” economist Dennis Gartman said in his daily newsletter. “However, that time is not today; tomorrow perhaps. Today is correction day; today is late-long liquidation day.” Pakistan may export as much as 2 million tons of wheat in the next six months after a shipment ban was lifted, said Agrocorp International Managing Director Vijay Iyengar. Global wheat shipments will increase by 2 percent annually to 133 million tons by 2015-2016, Etsuo Kitahara, the council’s executive director, said today. As much as 35 percent of the harvest in the Australian states of Queensland, New South Wales and Victoria risked being classified feed-quality after wet weather, Commonwealth Bank of Australia said Dec. 5. Animal Feed “The poor quality of Australian wheat may drag corn prices lower, as more wheat may be used for animal feed,” Korea Exchange Bank Futures’ Han said. Corn for March delivery lost 0.7 percent to $5.58 a bushel in Chicago, rebounding from a slide of as much as 1.7 percent. Soybeans for January delivery dropped 0.7 percent to $12.765 a bushel after falling as much as 1.5 percent. Corn and soybeans declined yesterday on speculation that rain will improve soil moisture for developing crops in Brazil and Argentina, the world’s biggest exporters behind the U.S. China’s soybean imports may drop to 5.3 million tons this month compared with about 5.4 million tons in November, the Ministry of Commerce said. Inbound soybean-oil shipments may total 195,000 tons in December, against 99,100 tons last month, it said in a statement dated yesterday. To contact the reporter on this story: Rudy Ruitenberg in Paris at rruitenberg@bloomberg.net; Jae Hur in Tokyo at jhur1@bloomberg.net To contact the editor responsible for this story: Claudia Carpenter at ccarpenter2@bloomberg.net; James Poole at jpoole4@bloomberg.net

Source