Tuesday, September 8, 2009

Market News

Doug Barrie harvests the 2009 wheat crop, uploaded by IdFarmBureau.
Wheat Prices Down
Chicago--Wheat fell to the lowest price of the year because of speculation that global production will outpace demand that that will limit overseas purchases of supplies from the U.S., the world's biggest shipper of the grain.

According to Bloomberg News, world output may total 659.3 million metric tons in the marketing year ending May 31, the U.S. Department of Agriculture said in a report on Aug. 12. That would be second only to last year’s 682.4 million tons. Global inventories may jump 8.3 percent to 183.6 million tons, the USDA said.

"The pressure's going to stay on prices because of increased global production and stockpiles," said Tomm Pfitzenmaier, of the Summit Commodity Brokerage in Des Moines, Iowa. "Crops overseas are better than they thought they were going to be. The U.S. crop has been decent."

Wheat futures for December delivery fell 7 cents, or 1.4 percent, to $4.7875 a bushel on the Chicago Board of Trade. Earlier, the most-active contract touched $4.7525, the lowest since Dec. 5. The price declined 5.6 percent last month because of slack demand for U.S. inventories and rising global inventories.

Exporters sold 406,707 metric tons of wheat in the week that ended on Aug. 27, down 38 percent from the prior week, the USDA said in a report last week.

Wheat is the fourth-biggest U.S. crop, valued at $16.6 billion in 2008, behind corn, soybeans and hay, government data show.

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