FX.co ★ Wheat review for May 16, 2011

Futures on wheat closed with a gain on Monday as bad weather conditions have been threatening wheat production globally. Cool weather and rains slow field work in the USA and Canada down.
By the end of CBOT trades July futures on wheat gained 8/34 cent (1.2%) and constituted thus USD 7.37 ½ per bushel.
Futures on wheat grew on Monday amid concerns regarding poor crops this year in the USA which is the major wheat exporter.
At weekend farmers started harvesting in Texas and Oklahoma and informed of low quality of crops.
For instance, in West Texas wheat harvest is expected to constitute 23 mln. bushels versus 103 mln. bushels last year. Harvesting is coming to its close in South Oklahoma which is quite unusual for the state in this time of the year. The reason for it is drought which ruined most part of wheat harvest. Amid adverse weather conditions traders have been concerned over reducing grain reserves. Last year drought resulted in Russia imposing embargo on grains export which was followed by wheat prices soaring to their highs for 2.5 years in February. However, since then futures lost 17%.
South region of the US Great Plains is not the only area where low-quality harvest is expected. North part was also hit by cold weather, namely snow and rain, this spring. Additionally, showers are predicted for this week which will also hamper seeding.