World Economy

Fears of Wheat Slump Spurs Buying

Fears of Wheat Slump Spurs BuyingFears of Wheat Slump Spurs Buying

Wheat climbed on speculation that a decline below $5 a bushel for the first time since 2010 may spur buying. Corn and soybeans also increased.

The contract for December delivery rose as much as 0.8 percent to $5.045 a bushel on the Chicago Board of Trade after dropping to $4.96 yesterday, the lowest for a most-active contract since July 2010.

Prices were at $5.03 by 2:10 p.m. in Singapore to snap a six-session decline, the longest such streak since June 3.

The 14-day relative-strength index was below the level of 30 yesterday for a second day, signaling prices may be poised to rebound.

Wheat tumbled 22 percent in the past year as world output heads for a record 719.95 million metric tons, the US Department of Agriculture estimates.

Corn lost 25 percent in the same period and soybeans slumped 26 percent as the USDA predicted domestic harvests to reach all-time highs. Increasing supplies are helping cut global food prices, with a United Nations’ index slumping to an almost four-year low in August.

 “It is hard to see it sustained sub-$5 a bushel,” Ole Houe, director of advisory services at Ikon Commodities Pty in Sydney, wrote in an e-mail. “The current pressure is coming mainly from the impending US harvest of corn and soybeans and we think as soon as that crop is known we start focusing on next year’s crop.”

US farmers will collect 14.395 billion bushels of corn, while the soybean harvest will climb to 3.913 billion bushels, the USDA said Sept. 11. The US is the world’s biggest grower of both crops and the largest shipper of wheat.

Corn for December delivery advanced 0.1 percent to $3.4325 a bushel. Futures dropped to $3.3575 Monday, matching a four-year low reached on Sept. 11. Soybeans for delivery in November added 0.5 percent to $9.94 a bushel after touching $9.695 on Sept. 11, the lowest for a most-active contract since July 2010.