Soft commodity exchange traded funds are rebounding with wheat prices touching a four-week high as China increases imports to restrain rising prices.
Shi Wei, an analyst for Shanghai JC Intelligence Co., believes that China, the world’s largest consumer, could sell grain from its stockpiles and ask state-owned companies to increase imports, reports Jeff Wilson for Bloomberg.
“Record prices in China may increase demand” for U.S. wheat exports, Jason Britt, the president of Central States Commodities Inc., said in the article. “It looks like China may become more aggressive importing wheat.”
Wheat futures were up 1.9% Wednesday, trading around $670.5 per bushel. Soybean futures were 0.7% higher, trading around $1,321.8 per bushel. Corn gained 1.3%, trading at $454.8 per bushel.
Speculators have been pushing up prices on soft commodities, anticipating the U.S. Department of Agriculture will reveal lower Sept. 1 inventories. The government will update inventory levels on Sept. 30.
“Demand is sneaking up, and supplies are getting a little smaller,” Britt added.
Teucrium Wheat Fund
For more information on wheat, visit our wheat category.
Max Chen contributed to this article.
The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.