February 2, 2007

 

US Wheat Review on Thursday: Finishes lower on profit taking

 

 

U.S. wheat futures settled lower Thursday, led by weakness in CBOT wheat, sources said.

 

The market "kind of fell out of bed," a CBOT floor analyst said.

 

CBOT March wheat declined 7 1/4 cents to US$4.60 1/4, KCBT March wheat slipped 1 1/4 cents to US$4.87 1/2, and MGE March wheat declined 1 3/4 cents to US$4.93 1/2.

 

Trading activity was light and once early buying subsided, profit taking came in to the market "as there was little fresh news to trade on," he added.

 

Weaker corn prices late in the session, as corn was unable to maintain gains, also added to the losses, a floor trader said.

 

CBOT March corn fell 6 cents to US$3.98, settling under US$4 for the first time since Jan. 12.

 

Fund selling also weighed on wheat with over all fund selling at 4,000 contracts.

 

The market didn't have much follow through support from Wednesday's firm close, said Louise Gartner, an analyst with Spectrum Commodities, in Beaver Creek, Ohio.

 

The downside is limited, however, as U.S. wheat exports are becoming more competitive and wheat remains a follower of corn which is unlikely to decline much further, she added.

 

The USDA reported weekly wheat exports totaled 560,500 metric tonnes, within the 350,000 to 650,000 tonnes expected by analysts.

 

On daily open auction charts, March wheat traded an outside day, with both the high and low beyond those of Wednesday's session. March finished below its 10-day and 20-day moving averages but above its 200-day moving average

 

In CBOT trades, Fimat bought 500 March and sold 1,500 March, Iowa Grain bought 400 March, Goldenberg-Hehmeyer sold 1,000 March and Rand sold 500 March.

 

In options trading, JP Morgan bought 1,000 July US$4.80 puts and sold 1,000 July US$5.20 calls.

 

 

Kansas City Board of Trade

 

Hard red wheat futures finished modestly lower, following the weakness in CBOT wheat and corn futures, a floor source said. Light spread trading was noted between KCBT July and CBOT July.

 

On daily open auction technical charts, KCBT March settled beneath its 10-day and 20-day moving averages.

 

In mid-day KCBT trades, Prudential bought 200 March and sold 200 March, Man Financial sold 200 contracts and 200 July. ADM bought 200 March.

 

 

Minneapolis Grain Exchange

 

Spring wheat futures finished with light losses as the market continues to follow CBOT soft red wheat futures, a floor broker said. Light commercial buying was noted but was not a feature, he added. Light technical selling added to the losses, he noted.