Confidence about strong global supplies prompted wheat futures to bounce back from their lowest level in more than 90 days on Wednesday, according to Bloomberg.
The U.S. Department of Agriculture is slated to update last month's projections about world supplies of the grain and confidence is strong that demand will surge higher. But Australia, citing inclement weather in the form of dryness, slashed projections of its crop to 24.6 million metric tons after initial forecasts checked in at 24.8 million tons.
"Potentially $6 will offer some support," commodity sales director Michael Pitts with National Australia Bank Ltd. told the news outlet on Wednesday. "The market is expecting more availability of grain, larger carryouts generally, bigger crops. The question is really around the hard-red winter crop and the USDA's perception of that."
At 8:28 a.m. on Wednesday, wheat futures rose 0.75 percent, a 0.045-cent gain to $6.0575 per bushel.
Agrimoney reports dry weather is especially impacting the growing season in the eastern region of Australia and it is likely to continue and tug down crop quality.
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