Midwestern farmers might profit from a drought in Australia that’s affected the country’s wheat production.
Australia is one of the largest wheat exporters in the world.
It’s supposed to produce less than half the amount of wheat it had expected this year.
Vic Lespinasse is a market analyst with AG Edwards. He says farmers could profit from speculators pushing up the price of wheat.
“It’s good news for farmers in the Midwest,” Lespinasse says, “because they’ve largely harvested their crop and are marketing it at very high levels compared to where it was last summer, for example.”
Lespinasse says farmers may use more land for wheat next year because of higher prices.
Wheat prices hit a ten-year high Wednesday as investors worried about supply shortages over next few months.
This week at the Chicago Board of Trade, the price of wheat hit the exchange’s limit on two days.