CHICAGO- Chicago wheat futures rallied on Tuesday, even after India said it would allow overseas wheat shipments awaiting customs clearance, as traders focused on an unrelenting question roiling global prices: Where will the world get its grain?
The most-active wheat contract on the Chicago Board of Trade (CBOT) dipped early in the session, due to a spate of profit-taking, but ultimately settled up 30 cents at $12.77-1/2 a bushel.
India banned wheat exports on Saturday, just days after saying it was targeting record shipments of 10 million tons this year, as a scorching heat wave curtailed output and domestic prices hit a record high.
The government had said it would only allow exports backed by letters of credit (LCs), or payment guarantees, issued before May 13, leaving some 1.8 million tons of grain trapped at ports.
Wheat also received support from a US Department of Agriculture report late Monday, indicating worsening condition of the US winter crop, deepening worries about supply in an already-tight market. – Reuters
