Food riot concerns prompt spending on wheat

Wheat futures climbed to the highest since August as importers stepped up purchases while adverse weather cut global output, reported Bloomberg.

The U.S. Department of Agriculture said on Friday that exporters sold 1.054 million metric tons of wheat in the week ended January 13, seven times more than a week earlier and the most since August. Tunisia bought 100,000 tons of durum, Reuters said, citing European traders. Qatar, Bangladesh, Morocco and Iraq have issued tenders to buy rice or wheat since January 19.

“Some governments are concerned about food riots, so they’re walking into the rice and wheat markets and just buying it,” said Darrell Holaday, the president of Advanced Market Concepts in Manhattan, Kansas. “We’ve had enough production problems in different spots around the world that it’s caused some problems.”

Wheat futures for March delivery rose 7.25 cents, or 0.9 percent, to $8.3175 a bushel at 10:17 a.m. on the Chicago Board of Trade.

Before Monday, the most-active contract jumped 65 percent in the past year as drought slashed output in Russia. Dry weather in the U.S., the leading exporter, and China and floods in Australia threatened winter crops.

Wheat is the fourth-biggest U.S. crop, valued at $10.6 billion in 2009, behind corn, soybeans and hay, government data show.