Wheat rose from a three-week low in Chicago on speculation wet and freezing weather may have harmed some crops in the U.S., the biggest exporter, and amid expectations of sustained import demand.
Some winter-kill damage probably hurt wheat in northwest Kansas and southwest Nebraska after temperatures fell below zero degrees Fahrenheit, Commodity Weather Group wrote in an e-mailed report today. Some weather models indicate more cold in six to 15 days that may pose a risk of damage in the Midwest, though snow should protect most of the crop, the forecaster said.
"U.S. winter-wheat area was hit with ice and extremely cold temperatures over the weekend," Paul Georgy, the president of broker Allendale Inc., said in an online market comment. "Traders are talking about potential winter kill, but we will not see the true effect until spring."
Wheat for delivery in March added 0.2 percent to $6.52 a bushel by 7:44 a.m. on the Chicago Board of Trade. Milling wheat for the same delivery month traded on NYSE Liffe in Paris slipped 0.2 percent to 206 euros ($282.61) a metric ton.
"The cold snap that has hit the U.S. is accompanied by snowfall, but disparate with difficult-to-quantify fears of freezing damage, depending on the region," Paris-based farm adviser Agritel wrote in a market comment.
Chicago wheat touched $6.4925 a bushel in the prior session, the lowest since Nov. 12, and fell 2.7 percent last week on signs global stocks are swelling as harvests of the grain expand in Canada and Australia. Prices slumped 16 percent this year, set for a second annual retreat in three.
World wheat production will jump 6.6 percent to 698.4 million tons in the 2013-14 season, the International Grains Council forecasts. Imports will climb to 142.3 million from 140.8 million tons on increased buying by China and Egypt, according to the organization.
Import demand for wheat "is still strong," analysts Kona Haque and Chris Gadd at Macquarie Group Ltd. wrote in a report. "The hard-red winter markets should see resurgent demand from South America in coming months. We advocate being long U.S. hard-red winter wheat at the present."
Wheat shipments into Bangladesh jumped 46 percent from a year earlier to 1.15 million tons in the July 1-Nov. 28 period, the country’s Food Planning & Monitoring Unit said.