Wheat rose on speculation that a drought in Australia, expected to be the third-biggest exporter of the grain this year, will curb yields.
Australia may produce 8.8 percent less grain than estimated after the driest May on record, the country's Bureau of Agricultural and Resource Economics, or Abare, said in an e- mail. Production in the year starting Oct. 1 may fall to 23.7 million metric tons, the agency said, down from a March estimate of 26 million tons.
``It's been bad in Australia for the last two years, and there's not an improvement on the horizon,'' said Larry Young, a senior trader at Infinity Futures Inc. in Chicago. ``That's keeping the market underpinned with support.''>>>MOREThe Murray-Darling river basin where one-third of Australia's food is grown is in dire straits because upstream farmers are taking too much water for irrigation, scientists warned Wednesday. They said parts of the basin would be "beyond the point of recovery" unless the government bought back water allocations and got more water flowing by October. "There has been 10 years at least where people have said you have got to restore the environmental flows to the system if you want to keep the natural assets," Adelaide University's David Paton told national broadcaster ABC....MORE from EarthTimes