Markets Mind Wild U.S. Weather

CHICAGO - Apr 11/07 - SNS -- International agriculture commodity markets maintained a relatively busy tone overnight, with trading reported across a wide range of products.

Seeding is now underway in the United States, making weather a more important factor for markets. Analysts at the Chicago Board of Trade (CBOT) note, "Some models show rains continuing next week while others show a dry trend, and the market looks to remain hyper-sensitive to weather developments until the crop is planted."

Recent rains are lowering yield expectations on the remaining soybean crop in Argentina, they said. "With significant damage from the freeze to soft red winter wheat in Arkansas, Missouri, Kentucky and Tennessee there is increased concern that traditional double-crop wheat areas will move to a full season soybean crop which could significantly boost yield."

In the USDA's weekly crop conditions report, winter wheat was rated 64% good/excellent compared to 71% last week and 41% last year. Kansas alone dropped to 55% good to excellent from 77% last week. In addition, the Kansas state-by-state report indicated that 16% of the crop experienced severe frost damage, 15% was moderately damaged and 15% lightly damaged. The percentage of the winter wheat crop rated poor/very poor stood at 10% compared to 6% last week and 30% last year. Traders await agronomist's crop assessments of the freeze damage in key producing areas.

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