Russia is the second largest supplier of wheat, so when the forecast called for hot and dryer weather than usual, the global industry took notice. Russia has already lowered its forecast for crop by nearly 6% due to the heat and drought, and as the temperatures seem to be continuing their adverse incline, the food industry is on alert.
Bloomberg has more:
“Concern is mounting regarding the dry and hot situation developing in western Europe, parts of Russia and former CIS regions,” Commonwealth Bank of Australia said in a report e- mailed today, referring to the former Commonwealth of Independent States. “Some crop damage is likely.”
Russia pared its estimate of grain harvests by about 6 percent to 85 million tons because “the drought is more severe than expected,” Agriculture Minister Yelena Skrynnik said, according to a transcript posted on the state website July 5.
While the rise started last week in Europe, the US has also started to react. According to Agrimoney.com, Chicago wheat caught up a little, with the July lot adding 1.0% to $4.92 ¾ a bushel as of 07:00 GMT (08:00 UK time), while the September rose 0.9% to $5.07 ¾ a bushel.
