June 29, 2010

US wheat futures fall to two-week low as dry weather speeds harvest

Wheat futures fell to a two-week low on speculation that dry conditions will allow farmers to speed up the harvest in the US, the world's biggest exporter.

The dry weather will spread this week from Ohio to the largest winter-wheat producers, Kansas and Oklahoma. As of June 20, 17% of the winter-wheat crop was harvested, up from 15% a year earlier, according to a USDA report. The price has dropped 17% in the past year.

Wheat futures for September delivery fell 6 cents, or 1.3%, to US$4.65 a bushel on the CBOT. The price earlier declined to US$4.595, the lowest level for the most- active contract since June 14. The commodity has dropped 14% this year.

The price also declined on slack demand for US supplies as importers turn to countries in the Black Sea region. Egypt, the world's biggest buyer, on June 26 said it purchased 120,000 tonnes of Russian wheat for US$165 a tonne. US supplies at ports near New Orleans sold for US$186 a ton on June 25.

Wheat is the fourth-biggest US crop, valued at US$10.6 billion in 2009, behind corn, soy and hay, government data show.