Wheat prices surge over three percent as India considers reimposing 25% import tax

Wheat futures rose over three percent in American trade, shrugging off the dollar's rise, which follows a spate of data from the U.S., the world's second largest wheat exporter, and India, the world's second largest producer.
 
As of 08:29 GMT, wheat futures due on March 16 jumped 3.10% to $457.50 a bushel from the opening of $443.75, with an intraday high at $457.75, and a low at $442.25, while the dollar index rose 0.54% to 101.67 from the opening of 101.49.
 
Earlier U.S. data showed personal income rose 0.4% in January, adding to December's 0.3% rise, while analysts expected the same rate of 0.3%.
 
Personal spending on the other hand rose 0.2%, missing expectations of a 0.3% rise, and compared to December's 0.5% jump.

The final manufacturing PMI inched down to 54.2 in February from 54.3 in January, missing expectations of 54.4, while the ISM manufacturing PMI rose to 57.7 in February from 56.0 in January, besting expectations of 56.2.

ISM manufacturing prices edged down to 68.0 from 69.0, missing expectations of 68.5.

On the same note, the Indian government said it might reimpose a 25% import tax on wheat by mid-March after cutting it to 10% last September, which was supposed to return to 25% in December before the government extended the tax cut, with traders importing over five million tonnes since mid-2016 to cover the shortfall in India.

The change of heart came ahead of the harvest season in the world's second largest wheat exporter later this month, and after the Indian Agriculture ministry raised its forecast for wheat production in 2017 to 96.64 million tonnes from 92.29 million tonnes in 2016.