A wheat-related ETF surged as traders anticipated increased weather damage due to dry conditions.
The Teucrium Wheat Fund (NYSEArca: WEAT) increased 4.9% Wednesday and broke back above its short-term trend line at the 50-day simple moving average. Meanwhile, CBOT wheat futures were 6.4% higher to $5.43 per bushel.
Wheat futures gained on concerns about dryness damaging the dormant crop in the U.S. Plains, reports Mark Weinraub for Reuters.
“Dry weather is expected this week, which will allow dryness to increase again, stressing corn and soybean development,” Kyle Tapley, meteorologist at Radiant Solutions, said in a note to clients.
“We’re in a weather market with its ups and downs,” Sebastien Poncelet of consultancy Agritel told Reuters.
Wheat Export Inspections
The USDA on Monday morning reported weekly wheat export inspections were 487,902 metric tons, or in line with a range of analysts’ forecasts.