US Wheat Review on Tuesday: Falls on pressure from other markets

 

 

Pressure from other markets and a lack of fresh, supportive export news dragged U.S. wheat futures lower Tuesday, traders said.

 

Chicago Board of Trade March wheat closed down 28 1/4 cents at US$5.50 a bushel. Kansas City Board of Trade March wheat sank 29 1/4 cents to US$5.79 3/4, and Minneapolis Grain Exchange March wheat lost 23 1/4 cents to US$6.29 1/2.

 

Strength in the U.S. dollar weighed on wheat, as a firm greenback gives foreign countries less buying power to import U.S. grain, traders said. The U.S. continues to face tough competition for export business from the Black Sea region and Europe, analysts said.

 

After the close of trading, Egypt's state-owned General Authority for Supply Commodities, said it is tendering to buy 55,000-60,000 tonnes of wheat. The results of the tender should help give the market direction Wednesday, a trader said.

 

Tumbling CBOT soybeans added pressure to the grains Tuesday, traders said. Wheat has been a follower of corn and soybeans lately.

 

Some sell stops were triggered as prices fell, a CBOT floor trader said. CBOT March wheat dropped below last week's low of US$5.62, its 45-day moving average of US$5.58 1/2 and its 50-day moving average near US$5.57.

 

 

Kansas City Board of Trade

 

It seemed there was "some general market weakness," with the inauguration of U.S. President Barack Obama distracting traders, a KCBT floor trader said. There was an absence of bullish export news, he said.

 

Sinking soybeans weighed on KCBT wheat, the trader added. Spread trading was "quiet," he said.

 

Market participants stopped talking about winterkill, traders said. They had worried last week that cold weather in the U.S. Plains and Midwest could hurt dormant winter wheat.

 

"We still make the wheat crop or break it mostly in May to June," an analyst said. "Winterkill is not normally a big issue."

 

 

Minneapolis Grain Exchange

 

The strong U.S. dollar and weak soybeans were bearish influences on MGE wheat, a trader said. The markets closed near session lows after some late technical selling, he said.

 

Japan is seeking 157,000 tonnes of wheat, including 90,000 tonnes of U.S. wheat, in a tender to be concluded Thursday. The business is routine, traders said.