Wheat ticks lower, but other grains keep gaining day after USDA forecasts big US crops

Wheat ticks lower, other grains keep gaining

NEW YORK — Wheat prices gave back some of their big gains Friday, but prices of other grains continued to rise.

Wheat prices had surged Thursday after the U.S. government lowered its expectations for global wheat production because of a drought that has destroyed at least a fifth of Russia’s crop and bad weather elsewhere in the world. Russia is a major grains exporter.

The Agriculture Department’s revised global forecast calls for 2010-11 production of 645.7 million metric tons of wheat, 2.3 percent less than it estimated in July.

Wheat for December delivery slipped 9.5 cents, or 1.3 percent, to settle Friday at $7.3425 a bushel. It had risen 2.6 percent Thursday. The September futures contract hit a two-year high of $7.8575 a bushel last week.

That peak isn’t likely to be hit again unless the drought in Russia prevents farmers from planting their 2011 crop, cutting into next year’s supply, said John Sanow, analyst with Telvent DTN in Omaha, Neb.

“There remains plenty of wheat near term to meet the needs of end users,” Sanow said.

The USDA also predicted Thursday that the U.S. could set records for corn and soybean harvests, and expects more exports of both than it did in July. That means higher income is likely for U.S. farmers as prices rise.

December corn added 5.5 cents to $4.2725 a bushel and November soybeans gained 15.5 cents to $10.44 a bushel.

Oil and other energy contracts lost some ground as reports on U.S. retail sales pointed to slowing economic growth.

Benchmark crude for September delivery dropped 38 cents to settle at $75.77 a barrel on the New York Mercantile Exchange. Oil earlier touched a one-month low at $75.41 a barrel.

In other Nymex trading in September contracts, heating oil fell less than 1 cent to $2.9956 a gallon and gasoline dropped 1.52 cents to $1.9396 a gallon.

October natural gas rose 3.5 cents to $4.350 per 1,000 cubic feet.

Slower economic growth likely means that consumers and businesses will need less fuel for shipping, driving and industrial processes.

Trading in metals was muted. Gold settled nearly flat after rising 1.5 percent Thursday. The December contract ticked down 10 cents to settle at $1,216.60.

September silver added 4.4 cents to $18.109 an ounce; December copper dropped 3.3 cents to $3.2725 a pound; October platinum shed $5.40 to $1,526.20 an ounce and September palladium rose $6.20 to settle at $477.25 an ounce.