The risk of crop-damaging floods is increasing in Canada, the world’s second-largest wheat exporter, as late-season snow and freezing weather delay spring planting across the Prairie Provinces and into the northern U.S.
Wheat climbed for a third day as freezing conditions in the U.S. raised the risk of more damage to the winter crop, while cold soil temperatures may delay spring planting. Corn increased and soybeans declined.
Wheat’s premium over corn, which was erased in March, will surge to the highest this year as a persistent drought in the Great Plains revives concern that crops were damaged, said Frank J. Cholly at RJO Futures.
Wheat advanced for a second day, extending a rebound from the lowest level in nine months, on concern that freezing conditions in the U.S. probably hurt the winter crop, while wet weather may delay planting of the spring crop. Corn fell for a fourth day, deepening a bear market.
The second major snowstorm in a week for the southern Great Plains is delivering moisture to U.S. wheat crops that went dormant in November in the worst condition since at least 1985 because of a drought.
The drought that ravaged U.S. corn and soybean crops and spurred record prices may persist, threatening a recovery in production this year that’s needed to bolster global inventories, according to forecasters.