News
29.12.2009
Wheat Falls as Rally, Dollar Gain May Curb Demand for U.S. Crop
Wheat dropped on speculation that a price rally to a three-week high and the dollar’s rebound may reduce demand for the U.S. crop. Corn and soybeans also declined.
The grain yesterday jumped 5 percent, the most since Nov. 11, leading gains in corn and soybeans on speculation that fund managers will purchase agricultural commodities at the start of 2010, anticipating improved demand as the global economy strengthens.
“It’s a technical adjustment after wheat gained sharply, pushing corn and soybeans higher,” Takaki Shigemoto, an analyst at research and investment company JSC Corp. in Tokyo, said today by phone.
Wheat for March delivery declined as much as 1.3 percent to $5.435 a bushel on the Chicago Board of Trade and traded at $5.46 as of 2:52 p.m. in Tokyo. The contract yesterday touched $5.51, the highest level since Dec. 8. The grain has lost 11 percent this year.
The dollar traded near a two-month high against the yen on speculation the Federal Reserve may end emergency stimulus measures. The U.S. currency gained versus the euro for a second day before a report that economists said will show U.S. consumer confidence grew this month.
A rise in the dollar often curbs demand for U.S. supplies from overseas importers holding other currencies.
March-delivery soybeans slid 0.4 percent to $10.3425 a bushel after yesterday posting the biggest daily advance since Oct. 12.
China’s Imports
China’s soybean imports in the first quarter of 2010 may increase as much as 2 million metric tons from the current quarter to 12 million tons, the China National Grain & Oils Information Center said today in an e-mailed statement.
Domestic supplies in the first quarter may be in surplus, it said after imports in December may reach a record 4.8 million tons.
Corn for March delivery fell for the first time in four days, dropping 0.3 percent to $4.1475 a bushel after touching $4.1875 yesterday, the highest price since Dec. 1. The market has been concerned about snow and ice damage to late- harvested U.S. crops, Shigemoto said.
About 5 percent of the corn crop in the U.S., the world’s largest producer, remained uncollected as of Dec. 20, the U.S. Department of Agriculture said last week. The harvest, which is usually completed by the end of November, has proceeded this year at the slowest pace since at least 1986, according to the department.
Bloomberg
