Wheat Drops To 6-Week Low

Avatar for Matt Hopkins By Andrea Klosterman Harris|22 July 2008

Global output will rise 8.8% to a record 664.2 million metric tons in the year that started June 1, said the US Department of Agriculture (USDA) on July 11. USDA increased last month’s estimate from 662.9 million tons as favorable weather improved crop prospects in the US, Europe, and Australia. “The crop size is still increasing and that will eventually slow US exports,” said Roy Huckabay, executive vice president for the Linn Group in Chicago. “There is a cushion for global wheat supplies this year.”

The USDA said global reserves fell 8.5% to 116.1 million metric tons on June 1, the lowest since 1982. World inventories are forecast to rise 15% to 133.1 million tons in 2009.

About 61% of the spring wheat crop was in good or excellent condition as of July 13, down from 69% a week earlier, reported USDA last week. Wheat is the fourth-biggest US crop, valued at a record $13.7 billion in 2007, according to government figures.