China makes largest US wheat buy in three months

wheat  USDAgovChina has made the largest wheat purchase from the US in three months buying 360,000 tonnes of US soft red winter wheat for shipment in the 2013/14 marketing year

The purchase, confirmed by the US Department of Agriculture, has ignited the strongest wheat futures rally in two weeks on ideas that Beijing would need further imports to supplement its rain-damaged crop.

Unseasonal rains in May have forced China to ramp up imports in order to meet demands in the country.

While Chinese stockpiler Sinograin bought the crop from US, state-owned trader COFCO has purchased 300,000 tonnes of Australian wheat.

China, the world’s largest wheat producer, have also been eyeing Canadian wheat with the untimely rains damaging close to 11mn tonnes of China’s crop.

Jefferies Bache analyst Shawn McCambridge said, “China has production and quality issues with its wheat crop this year and the country is going to have to bring outside supplies for blending purposes and for outright needs.”

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