CHICAGO, May 22 (Reuters) - Chicago Board of Trade wheat futures surged to their biggest premium over corn since 2022 this week, stoking demand for cheaper alternatives that could help whittle down large global corn supplies.
Farmers are expected to boost feedings of corn to cattle, hogs and poultry after wheat prices soared to a 10-month high on deteriorating crop prospects in Russia, the world's biggest exporter, market analysts said.
Concerns about global wheat supplies sent the benchmark contract soaring to a premium of $2.39-1/2 per bushel over corn on Tuesday, the largest since October 10, 2022.
That difference now makes the staple foodstuff too expensive to be a top choice for animal feed, analysts said.
Wheat is normally cultivated for human food, but can be used as an animal feed when supplies are abundant and prices are low.
"This $2-plus level, definitely in my research, would say we are at a food-grade status in the wheat," said Mike Zuzolo, president of Global Commodity Analytics.
CBOT wheat's 37% rise from lows set in March has far outpaced corn's meager 15% increase from its 2024 low set in February.
The U.S. government this month projected global use of wheat as animal feed to decline about 5% in the upcoming season due to cheaper options.
"What the market is saying right now is we have an ample supply of corn," said Arlan Suderman, chief commodities economist for brokerage StoneX.
U.S. corn exports could increase as a result of wheat's surge, analysts said.
The USDA on Tuesday reported exporters sold 110,000 metric tons of U.S. corn to Spain. Suderman said the deal looked to be driven by the wheat-corn spread.
"This could be a global phenomenon where the wheat-corn spread globally really turns the corn into the primary feed grain," Zuzolo said.
"It could be the strongest feeding side of the equation for corn in probably 5-7 years." (Reporting by Tom Polansek; Editing by Daniel Wallis)
