How long will the wheat price last?

Russia’s poor 2010 wheat harvest has sent prices north but for how long?

The Russian shortages of wheat are also being compounded by news of further crop failings in Europe. Germany’s 2010 grain crop is likely to fall to around 44 million tonnes from 49.7 million last year due to poor weather conditions. More recently, Russian wheat plantings for the next season have been estimated at 0.356 million hectares as opposed to 0.964 million hectares this time last year. The continued hot, dry weather is causing the soil to compact so that plantings are difficult due to the dryness and hardness of the soil. We can therefore expect Russia to be experiencing continued shortages which will support wheat prices out into 2011. They will push Kazakhstan to limit their export for any other destination other than Russia.

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