Wheat Futures Rise as Cold, Drought Threaten U.S. Crop
Wheat futures rose for the third time in four sessions on speculation that cold weather earlier this week and continued dry weather in the U.S. southern Great Plains will curb production.
About 18% of Kansas, the biggest U.S. wheat producer, is now in an extreme drought, meaning "major crop and pasture losses" and "widespread water shortages or restrictions" are imminent, the U.S. Drought Monitor, a Lincoln, Nebraska-based group that tracks dry weather, said Thursday. Hard-red winter wheat, high-protein varieties used to make bread, are grown in the southern Plains.
Rain that is expected to fall in parts of the region this weekend probably won't improve soil moisture or help plants, private forecaster MDA Weather Services said in a Wednesday report.
A cold snap on Sunday and Monday that dropped temperatures to below freezing may have damaged plants that had recently emerged from winter dormancy, Kansas State University agronomist Jim Shroyer said earlier this week. Crop scouts generally can't confirm damage from cold weather for several weeks as symptoms take time to show, he said.
Traders are "trying to find out more about the wheat-crop prospects" after the cold, dry weather this week, said Dave Marshall, a farm marketing adviser at Toay Commodity Futures Group LLC in Nashville, Ill.
Chicago Board of Trade wheat futures for May delivery rose 3 1/4 cents, or 0.5%, to $6.91 1/4 a bushel.
Corn futures fell to the lowest intraday price in almost three weeks as expected drier weather in the next 14 days will allow farmers to speed planting in the U.S. Only about 3% of the crop was seeded as of Sunday, down from the prior five-year average of 6%, the U.S. Department of Agriculture said Monday.
Corn futures for May delivery fell 2 3/4 cents, or 0.6%, to $4.94 3/4 a bushel in Chicago trading, the lowest closing price for a front-month contract since March 28.
"Going into a three-day weekend, you'd think at some point farmers are going to get into the field," Mr. Marshall said.
Soybeans dropped on signs of weakening demand for U.S. supplies. Exporters in the seven days through April 10 sold 19,200 metric tons of the oilseeds to overseas buyers, down 76% from the prior week and 79% from the previous four-week average, the USDA said Thursday.
While sales declined, stockpiles in the U.S., the world's second-biggest exporter of soybeans, are forecast by the government to fall to the lowest level in a decade, which may force processors to import supplies from Brazil.
Soybean futures for May delivery fell 4 3/4 cents, or 0.3%, to $15.14 a bushel on the CBOT.