Wheat declined for a fifth day to trade near the lowest in four years after the U.S. government forecast record global harvests and growing stockpiles. Corn and soybeans headed for the biggest weekly losses since July.
Global wheat production may be a record 719.95 million metric tons, the U.S. Department of Agriculture said yesterday, lifting its outlook from 716.09 million tons in August on bigger crops in the European Union and Ukraine.
Wheat for December delivery fell 0.8 percent to $5.0525 a bushel on the Chicago Board of Trade by 6:48 a.m. after prices touched $5.03 yesterday, the lowest for a most-active contract since July 2010. Futures are set to drop 5.6 percent this week.
The USDA report “was generally construed bearishly,” economist Dennis Gartman wrote in his daily newsletter. “The market has been bearish and there was nothing in this report that would suggest turning the tide in the other direction.”
Milling wheat for November delivery fell 1.2 percent on Euronext in Paris to 162 euros ($209.37) a metric ton after earlier touching 160.50 euros, the lowest for a most-active contract since July 2010.
Chicago wheat prices tumbled 23 percent in the past year as corn slumped 27 percent and soybeans lost 29 percent on the outlook for surging world output. Increasing supplies of crops are helping cut global food prices, with a United Nations’ index slumping to a four-year low in August.
“You’ve got more European wheat, which seems to satisfy the market right now, and the Russian wheat crop looks better as well,” Wayne Gordon, a commodity analyst at UBS AG in Singapore, said by phone today. “The market seems to be completely ignoring the individual quality risks.”