Futures Market News
Grains continue to rise as drought pummels crops
Aug 02, 2010 01:37 PM
The prices of a number of key grains resumed their upward trajectory on Monday as Russian drought continues to threaten the world's supply of wheat. That in turn is pushing up the price of corn and soybeans, which some farmers and consumers may turn to if wheat becomes too expensive.
Wheat prices soared 30 percent in the month of July. Monday, the Russian Grain Union cut its forecast for the country's total crop of grain to between 72 and 78 million tons, down from around 85 million tons.
In Chicago, the price of wheat futures contracts for September delivery rose 3.5 percent to $6.84 per bushel, the highest level in almost two years. Weather has been harsh on projected wheat harvests around the world, from the Black Sea region's drought to torrential rains in Canada.
Corn futures for December delivery rose 1.5 percent to about $4.13 per bushel, and soybeans gained 1.2 percent to $10.17 per bushel.
"Wheat shouldnt cost less than $300 a ton this season. I believe this level will be reached shortly," Kirll Podolsky of Russian grain trader Valars group told Bloomberg News.
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