US wheat prices soar on export talk
Wednesday, 31 October 2007
CHICAGO, Oct 30 (Reuters): US wheat futures soared more than 3 per cent yesterday, rebounding from last week's declines on a mix of export rumors and spillover strength from crude oil, traders said.
The surging energy market lifted US soy and corn prices as well, boosting soybean oil futures on the Chicago Board of Trade to a near 33- year high.
US crude oil surpassed $93 per barrel and neared $94 as the US dollar fell to record lows and as Mexico suspended one- fifth of its oil exports due to stormy weather.
Reflecting broad strength across the commodities sector, the Reuters/Jefferies CRB Index of 19 commodity prices hit its highest level since August 2006 and closed up 1 per cent at 349.43.
At the CBOT, wheat for December delivery rose its daily limit of 30 cents, reaching $8.30 a bushel, before easing to close at $8.28-1/2, up 28- ½ cents.
"With crude at $92 and climbing, what else do you do?" one CBOT wheat trader said.
"There are rumors Iraq, Pakistan and India are tendering for wheat, with the Indian tender at 1.0 million tonnes, which seems like an awful lot of wheat, but keep in mind these are rumors," the trader said.
The talk about India had surfaced in overnight trade but there was no confirmation Monday, traders and analysts said. India does not usually buy US wheat but a large tender would further restrict global supplies, which are already forecast to drop to 32-year lows by the end of the 2007/08 marketing year.
The surging energy market lifted US soy and corn prices as well, boosting soybean oil futures on the Chicago Board of Trade to a near 33- year high.
US crude oil surpassed $93 per barrel and neared $94 as the US dollar fell to record lows and as Mexico suspended one- fifth of its oil exports due to stormy weather.
Reflecting broad strength across the commodities sector, the Reuters/Jefferies CRB Index of 19 commodity prices hit its highest level since August 2006 and closed up 1 per cent at 349.43.
At the CBOT, wheat for December delivery rose its daily limit of 30 cents, reaching $8.30 a bushel, before easing to close at $8.28-1/2, up 28- ½ cents.
"With crude at $92 and climbing, what else do you do?" one CBOT wheat trader said.
"There are rumors Iraq, Pakistan and India are tendering for wheat, with the Indian tender at 1.0 million tonnes, which seems like an awful lot of wheat, but keep in mind these are rumors," the trader said.
The talk about India had surfaced in overnight trade but there was no confirmation Monday, traders and analysts said. India does not usually buy US wheat but a large tender would further restrict global supplies, which are already forecast to drop to 32-year lows by the end of the 2007/08 marketing year.