Wheat futures rose the most since November after the U.S. Department of Agriculture said stockpiles will be lower than analysts expected and that less winter grain was planted than forecast.
Inventories on May 31 will total 716 million bushels, the USDA said in a report today. That’s down from the 754 million bushels forecast in December and the 741 million projected by analysts surveyed by Bloomberg News. U.S. winter plantings totaled 41.8 million acres, less than the 42.6 million forecast in the survey.
“The stocks number was bullish, and that’s where all the buying is coming from,” Jamey Kohake, a broker and branch manager at Paragon Investments in Silver Lake, Kansas, said by telephone. The lower-than-expected acreage “reiterated that there’s a downside limit in wheat.”
Wheat futures for March delivery jumped 2.6 percent to $7.64 a bushel at 11:31 a.m. on the Chicago Board of Trade, heading for the biggest gain since Nov. 27. The price through yesterday dropped 4.3 percent this month.
In the U.S., wheat is the fourth-largest crop, valued at $14.4 billion in 2011, behind corn, soybeans and hay, government data show.