Wheat Slides on Signals Demand May Be Easing, Improved U.S. Crop Condition

Wheat futures fell in Chicago on signs demand for U.S. grain may be waning, and as the condition of the winter-wheat crop improved in the country, the world’s largest shipper.

March-delivery wheat lost as much as 1.4 percent to $7.0275 a bushel on the Chicago Board of Trade, and was at $7.04 a bushel at 1 p.m. Paris time.

Wheat inspected for export at U.S. ports fell 21 percent to 15.32 million bushels in the week to Nov. 11, the U.S. Department of Agriculture reported yesterday. Conditions of the U.S. winter-wheat crop improved last week, the USDA said in a separate report.

“Negative for prices were the USDA’s weekly inspections,” Luke Mathews, a commodity strategist at Commonwealth Bank of Australia, said by phone today.

About 46 percent of U.S. winter wheat was rated good or excellent as of Nov. 14, up from 45 percent a week earlier and compared with 64 percent a year earlier, the USDA said in a weekly report yesterday. An estimated 87 percent of wheat had emerged, compared with 82 percent a week earlier and 85 percent on average in the previous five years, the USDA said.

“The rain that was so awaited in the U.S. wheat belt has come, lightening the mood, even if it wasn’t seen as sufficient and regular, particularly in Texas and Kansas,” Paris-based farm adviser Agritel said in a report on its website today.

Australia will have greater feed-wheat supplies this year for export as continuing rainfall degrades more milling-quality grain into stockfeed, AWB Ltd., the country’s largest shipper, said in an e-mailed statement today.

‘Significant’ Advantage

“AWB is already making strong export sales of feed wheat, with steady inquiry appearing from customers in Asia and Pacific markets, where we have a significant freight advantage over just about every other origin,” the company’s General Manager Commodities Mitch Morison said.

Australia is the world’s fourth-largest wheat exporter, according to the USDA. The three biggest are the U.S., the European Union and Canada.

Milling wheat for January delivery traded on NYSE Liffe in Paris fell 1.9 percent to 214.50 euros ($291.85) a metric ton.

March-delivery corn lost 1.8 percent to $5.59 a bushel in Chicago, while January-delivery soybeans slipped 2 percent to $12.6075 a bushel.

(Source: http://www.bloomberg.com/news/2010-11-16/wheat-slides-on-signals-demand-may-be-easing-improved-u-s-crop-condition.html)