New York: Wheat prices have soared near their highest levels ever on concerns that growing demand in Asia coupled with dwindling stockpiles could lead to a grain shortage in the United States.
Other commodities markets mostly declined, with energy, other agricultural products and precious metals moving lower.
US wheat stockpiles have thinned as bad weather has battered crop after crop around the world, most recently in Argentina and India.
The scarcity has fed seemingly relentless demand for wheat supplies, often at any cost.
US wheat exporters have sold more than 15 million bushels a week for seven of the last 11 weeks, well above the US Department of Agriculture’s weekly target of about one million bushels a week.
Dry weather in India, the world’s second largest wheat producer, has contributed to global supply tightness. India’s grain-belt has been stricken with long periods of drought since December, threatening roughly half the country’s 2.8 billion bushel crop.
“They’re stuck in that (dry) pattern. The damage isn’t done yet, but it will be done if we stay in this pattern for the next two or three weeks,” Ward said.
Unprecedented demand for agricultural products from fast-growing countries including China and India has exacerbated the supply crunch.
In the market panics of previous years, prices would rise to a level that developing countries couldn’t afford. But as the economies of some development countries strengthen, high prices have not slowed their buying of major food commodities.