(Bloomberg) – Wheat fell for a second day as the prospect of warmer weather in the U.S. boosted the outlook for supplies from the world’s top exporter after winter storms brought freezing temperatures and crop conditions dropped.
The contract for March delivery lost as much as 0.3 percent to $5.8525 a bushel on the Chicago Board of Trade and was at $5.855 at 10:22 a.m. in Singapore. Prices rallied 6.5 percent since dropping to $5.50 on Jan. 29, the lowest since July 2010.
Temperatures should warm across the Plains this weekend and in the Midwest and Delta regions next week, MDA Information Systems LLC said yesterday. Milder conditions in the Plains will start to increase soil temperatures and allow wheat to break dormancy, it said. Global production will reach a record 711.89 million metric tons in 2013-2014 on bigger harvests from Canada to Australia, the U.S. Department of Agriculture said Feb. 10.
“Forecasts for mild temperatures in the U.S.” may lower the threat of winterkill, Luke Mathews, a commodity strategist at Commonwealth Bank of Australia, wrote in a note today. “The failure to push through the psychologically important 600 cents barrier last night corresponded with technical resistance” at the 50-day moving average, he said.
The 50-day moving average was at about $5.98 yesterday, according to data compiled by Bloomberg, and futures rose to as much as $5.9825, the highest level since Jan. 8. Resistance levels are typically marked by clusters of sell orders.
In Kansas, the top U.S. producer of winter-wheat varieties, the crop was rated 35 percent good or excellent from 58 percent on Dec. 30, the USDA said Feb. 3.
Soybeans for May delivery advanced 0.3 percent to $13.135 a bushel. Corn for March delivery was at $4.395 a bushel from $4.40 yesterday.
