Wheat at 13-Month High on Droughts, Floods, Stockpiles Concern
Wheat reached 13-month high levels today as the weather troubles continue to remain a major concern of the main commodity suppliers across the world. It also looks unlikely that China or India will sell from their wheat stockpiles to satisfy the global demand.
Floods in Canada and droughts in Australia, France, Kazakhstan and Russia threaten the grain production in those regions. According to the market researchers, the wheat production in Western Australia is to fall by 9.5 million ton this year. Russian exports may be decreased by the government limits this year as the crops are falling there.
Despite the fact that the world consumers will have to buy more grain from the southern hemisphere this year, such big holders of the wheat stockpiles as China and India will probably refrain from parting with them. Analysts believe that the prices will stop rising so fast only if some other exporters will cover the supply deficit. Technical analysis factors support the bullish point of view.
Wheat went up from $586.25 to $599.50 as of 16:33 GMT on CBoT today, a spike to $609.75 was recorded earlier.
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