US Wheat Review on Friday: Pares losses with late-session rally

 

 

U.S. wheat closed pared losses Friday, lifted by a last-minute rally attributed to position-squaring, a slide in the U.S. dollar, moderated crude oil losses and the day's options expirations.

 

Chicago Board of Trade March wheat lost 1/4 cent to US$5.19 1/4 per bushel, at the top end of a 16-cent trading range. The most actively traded May contract dropped 1/2 cent to US$5.30 1/2, atop a 17-cent trading range. Kansas City Board of Trade May wheat shed 3 1/2 cents to US$5.63 1/2. Minneapolis Grain Exchange May wheat lost 7 cents to US$6.05 1/4.

 

Speculative funds were seen as net sellers of about 1,000 contracts at the CBOT.

 

"It was not a big volume day," a CBOT floor broker said. "The trade was more spread-related." He noted that the "smack down" of the U.S. dollar and the mitigated losses of crude oil set the tonnee for the late session grain rally. "Wheat was a follower; it had no leadership," he said.

 

Export sales for the week ended Feb. 12 totaled 433,500 metric tonnes, or 15.9 million bushels. Analysts surveyed by Dow Jones Newswires had expected export sales of 200,000-500,000 tonnes.

 

U.S. wheat exports so far this marketing year, which began in June, total 23.5 million tonnes.

 

Egypt's state-owned General Authority for Supply Commodities said Friday it will tender to buy 55,000 to 60,000 metric tonnes of wheat Saturday on a free-on-board basis for shipment March 16-31.

 

The GASC is looking to buy 55,000 to 60,000 tonnes of U.S. soft red wheat, U.S. soft white wheat, U.S. hard red wheat, Argentine wheat, Australian wheat or Canadian wheat, Nomani Nomani, the undersecretary of the GASC vice chairman, told Dow Jones Newswires.

 

 

Kansas City Board Of Trade

 

Hard red winter wheat May futures trimmed the day's losses to close at the high end of an 11 1/4-cent trading range.

 

A severe drought in the southwestern Plains is eliciting concern, but traders say it is not having a direct impact on the market at this time.

 

In Texas, 12% of the HRW crop is rated good-to-excellent, according to a weekly condition report compiled mostly by local ag extension specialists for the Texas Agricultural Statistics Service.

 

Last year, when the state also faced "pretty bad" drought conditions the good-to-excellent ratings were 9% and the crop ended with a 30 bushel-per-acre average yield, said Doug Rundle, director of the Texas Agricultural Statistics Service.

 

By comparison, at this time in 2007 the HRW rated 42% good-to-excellent and ended up yielding a 37 bushel-per-acre average.

 

 

Minneapolis Grain Exchange

 

Hard red spring wheat ended mixed with the front month contract at an 19 1/2-cent premium to the May, as tight stocks in Duluth promise an interesting delivery period for the nearby contract.