Wheat price inches up after US winter planting delay

By Joanna Levin

MINOR weather related delays in the planting of the winter wheat crop has helped US wheat prices inch higher over the past week.

Americas wheat farmers have only planted 33% of their winter crop, compared with a five-year average of 39% at this point in the season. The Chicago December wheat futures contract gained 2.5¢/bushel over the week reaching 278.80¢/bushel.

Overall, the market is quiet as the industry awaits the quarterly grain stocks report, due to be released on Wednesday, 30 September.

Prices hit 20-year lows at the start of this month and producers are reluctant to sell at these levels. The Government has still not finalised a plan to give additional aid for beleaguered farmers. However, federal support will probably take the form of cash subsidies for producers, who will still be responsible for selling their own wheat into the market.

Under the old farming programme, Washington used to actually take ownership of the wheat and sell the grain from Government stocks. However, some analysts warn that, with subsidised wheat expected to remain in private hands, an overhang of supply in the market would be created, delaying a recovery in price.