Wheat prices were screaming higher all week, with spring wheat—used in pizza and bagels—jumping over $10 per bushel. Kansas hard red winter wheat—used for bread—rose sharply as well. Extreme heat in the Central Plains provided fuel, although a weak dollar and plenty of bullish news added to the upward sentiment. Eight more counties in California were declared in extreme drought, meaning the entire state is in a state of emergency. Crops in Brazil and China are also in trouble. Brazil’s severe drought created an energy crunch due to a shortage of hydropower.
A sharp rise in fertilizer prices will increase the cost of producing grain. However, Tom Vilsack, secretary of agriculture, has promised good news regarding biofuels is forthcoming. As of midday Friday, December wheat in Chicago traded at $7.53 per bushel. Kansas wheat at $7.68 and Minneapolis December wheat brought $10.05. December corn went for $5.36, up about three cents.
Hogs Gone Wild
Fears of weak buying from China were one of the reasons for the accelerating crash in hog prices this week. Exports to China are only about half this year as they were at this time last year. Prices tumbled from 78 cents to 73 cents this week alone. Hogs for December delivery fell roughly five cents this week, which is around 73.35 cents per pound.
Just as domesticated hog prices were the fastest-moving commodity this week, feral hogs are becoming a bigger threat. Wild pigs in Canada have created problems for farmers for years, but their geographical footprint is expanding. They may have been brought from Germany to British Columbia, bred with domestic pigs and then escaped. They are now found along the eastern edge of Ontario.
Feral hogs have been an issue in the U.S. for many years too, and several states allow for their hunting. Hunting is discouraged in Canada because it may worsen the problem. The pigs could potentially spread disease, much like livestock can, creating a biosecurity situation. They also damage crops by eating and trampling plants and could potentially contaminate water sources.
Inflation concerns and a weak U.S. dollar contributed to a run on the silver market toward the week’s end. Silver and platinum hit the highest levels in two months on Friday, but gold, though sharply higher, could not hang on to its sharp gains at Friday’s close. Silver for December delivery traded at $24.40 per ounce, up about $1.30 on the week.