Traders up-beat about wheat price turnaround
Posted
Commodities traders are confident Australian wheat prices will bounce back after slumping to a 15 month low.
The price of wheat dropped to $290 a tonne yesterday, down from about $360 two months ago.
Analyst Richard Koch says investors have been selling off stocks amid fears of slowing demand for commodities, such as iron ore and nickel.
However, Mr Koch says the demand for wheat remains strong and believes prices will improve once the market stabilises.
"The problems in the US will be offset, to some extent, by a continuation of demand in Asia, and once the market recognises that, I'd see our Aussie dollar strengthen," he said.
"At the same time, I think the markets will recognise that we need to encourage our producers to continue to produce grain, and that will see our hard commodities detach from soft commodities."
