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Wheat Futures Surge on Export Demand; Commodity Index Hits 13-Month High

March 19, 1993

CHICAGO (AP) _ Wheat futures prices surged Friday on the Chicago Board of Trade, leading most other grain and soybean markets higher as exporter demand for near-term supplies intensified.

Futures prices for most other commodities also rose, pushing the closely watched Commodity Research Bureau Index to a 13-month high of 213.82. The index, which measures the performances of 21 agricultural and industrial commodities, is regarded as an inflation indicator.

Among the markets posting gains were livestock and meat futures, precious metals and sugar. Oil futures retreated.

In Chicago, wheat for March delivery rose 10 cents to $4.06 a bushel; March corn rose 2 cents to $2.21 1/4 a bushel; March oats rose 1 1/2 cents to $1.37 1/4 a bushel; March soybeans edged up 1/4 cent to $5.86 3/4 a bushel.

The advance in wheat deliveries capped a week of strong gains tied to the Clinton administration’s generous distribution of U.S. wheat abroad.

″We’re changing toward a policy much more favorable to grain prices,″ said William Biedermann, research director with Allendale Inc., a commodities brokerage in Crystal Lake, Ill.

″We’re giving stuff away,″ he said, ″and when you’re giving it away, these prices are too cheap.″

In the past week, the administration has announced plans to donate 520,000 metric tons of wheat to Russia and subsidize sales of 1.5 million metric tons of U.S. wheat to other countries.

After the close of trading, the Agriculture Department’s Commodity Credit Corp. said it was seeking 200,000 metric tons of corn for donation to Russia.

Also, many analysts believe the United States is close to resuming grain sales to Russia after a nearly four-month interruption caused by Russia’s credit problems.

Hog and pork belly futures shot up their permitted daily limits for the second day in a row on the Chicago Mercantile Exchange on persistent signs of tight hog supplies.

Cattle futures ended mostly lower ahead of a monthly Agriculture Department report released after the close that showed fewer cattle on feed lots in the seven largest cattle-producing states than most analysts expected.

The USDA reported an 8 percent increase in cattle on feed over a year ago compared with an expected increase of slightly more than 9 percent.

April live cattle rose .08 cent to 83.35 cents pound; March feeder cattle rose .02 cent to 85.97 cents a pound; April live hogs rose the 1.50 cent limit to 51.87 cents a pound; May frozen pork bellies rose the 2-cent limit to 54.10 cents a pound.

April gold futures rose $1.10 to $332.30 a troy ounce on New York’s Commodity Exchange; March silver rose 0.6 cent to $3.677 a troy ounce.

May sugar futures jumped .73 cent to 12.18 cents a pound on New York’s Coffee, Sugar & Cocoa Exchange on new forecasts for a shrinking world surplus.

On the New York Mercantile Exchange, light sweet crude oil for April delivery fell 21 cents to $20.08 a barrel; April heating oil fell .35 cent to 58.02 cents a gallon; April unleaded gasoline fell .57 cent to 57.60 cents a gallon; April natural gas rose 5.6 cents to $2.087 per 1,000 cubic feet.

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