Wheat Prices Rise on Prediction of Lower Supply

Bloomberg reports that wheat futures "climbed to a three-week high on speculation that the U.S. Department of Agriculture may pare its estimate of global inventories for a fourth time, signaling tighter supply."

USDA "will forecast wheat stockpiles before the 2011 harvest at 171.09 million metric tons compared with 174.76 million tons last month, according to the average estimate of 13 analysts surveyed by Bloomberg.  The USDA cut its estimates every month since May, when it predicted stockpiles at 198 million."

The "advance" in wheat prices is a "concern" for Abdolreza Abbassain, a senior grains economist at the United Nations's Food & Agriculture Organization in Rome.  The rising wheat prices "helped push the FAO's global Food Price Index to 176 last month, the highest level since September 2008."

USDA "will release its next estimate on world agricultural supply and demand on Sept. 10 at 8:30 a.m. in Washington."

To read the Bloomberg story, click here.

Posted: 09/07/2010