Drought threatens wheat crops in China and the U.S.

Date:04-04-2011

Wheat crops in China, the world's biggest producer, and the U.S. are threatened by continuing drought as La Nina persists, weather forecasters said.

The countries will be the last to emerge from the dry weather linked to La Nina, a cooling of the Pacific Ocean, and the conditions may linger for two more months, said British Weather Services and Telvent DTN Inc.

Wheat may average $8.50 a bushel in Chicago from now to June 30, said Abah Ofon, an agricultural commodity analyst at Standard Chartered Bank in Singapore. That's 12 percent more than the price today, reported Bloomberg.

Wheat climbed 5 per cent yesterday as grain prices soared after U.S. corn stockpiles dropped to 6.52 billion bushels at the beginning of March, the lowest for the date since 2007, according to the U.S. Department of Agriculture.