By Joanna Newman
IT has certainly been quite a week for the US wheat market. Reactions to the NATO bombing of the Chinese embassy in Belgrade provoked fears that China could cut its US grain imports, putting pressure on US wheat prices.
Meanwhile diplomatic tensions in another part of the world had the opposite effect on the American wheat market.
The escalating trade war with the EU over European imports of US hormone-treated beef prompted US calls for punitive tariffs on EU shipments to the USA.
The proposed list includes 100% duty on European oats, a move which would benefit Americas domestic wheat producers.
Helped by this turn of events, the Chicago May futures contract gained almost 6¢ on the week to close on Tuesday (11 May) at 258.5¢/bushel.
The US wheat market is especially sensitive to international developments given the supply glut at home.
Due to high inventories, US farmers will soon face a logistical headache in storing their ample winter wheat harvest.
The fast-ripening winter crop is rated an impressive 73% good to excellent by the US Department of Agriculture, suggesting farmers could match last years record yield of 49 bushels an acre.
Meanwhile spring wheat planting continues apace, with 56% planted compared with a five-year average of 46%.