Green Markets

EWN Publishing

Wheat prices jump to an all time high; fears of a global food inflation spike

Posted by gmarkets on 3 September, 2007

Wheat prices jumped to an all-time high on 23 August as pan-icked buyers rushed into the market amid extremely tight supplies, raising fears of a global food inflation spike, reported The Australian (25/8/2007, p.40). Japan, Taiwan buy up wheat as Canada warns of 20pc output drop: Canada, the world’s second-largest wheat exporter, warned output might be 20 per cent below last year after bad weather damaged the crop, as it had in Australia and Europe. Japan and Taiwan, which de­pend on foreign wheat supplies, bought new cargoes in the inter­national market, while India launched a tender to beef up its inventories ahead of its peak demand season.

Wheat buyers flustered: Gavin Maguire, a grain analyst with Iowa Grain in Chicago, said the combination of disappointing production lev­els and very strong demand were pushing up prices. “Wheat buyers are beginning to panic,” he said.

Chicago price of $7.54 a bushel: In Chicago, wheat for Decem­ber delivery surged to an all-time high of $7.54 a bushel. Prices have jumped 110 per cent in the past 12 months and have risen threefold since 2000. The International Grains Council cut its estimate for the 2007-08 wheat crcp to 607 million tonnes while demand is set to reach 614 million tonnes.

The Australian, 25/8/2007, p. 40

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