February 24, 2007

 

US Wheat Review on Friday: Lower on profit-taking; near session lows

 

 

U.S. wheat futures settled lower Friday and near session lows at both the Chicago Board of Trade and Kansas City Board of Trade on profit-taking ahead of the weekend, a floor analyst said.

 

CBOT March wheat fell 5 1/4 cents to US$4.84 1/4, KCBT March wheat declined 5 cents to US$5.06 1/2, and MGE March wheat settled 1 1/2 cents higher at US$5.18.

 

"Wheat saw some profit-taking after the good gains established earlier in the week," said Joe Bedore, floor manager with FC Stonnee at the CBOT.

 

The weakness in corn and soybeans added to the lack of buying interest in wheat, Bedore said.

 

Trading activity was choppy with March options expiring and the grains extremely overbought and due for a pullback, said Louise Gartner, an analyst with Spectrum Commodities in Beaver Creek, Ohio. The funds have been aggressive buyers recently but appear to have wrapped up their purchases for now, she added.

 

Weekly export sales were within the range of analysts' estimates and termed "solid" by a floor trader.

 

The U.S. Department of Agriculture reported weekly wheat exports were 475,800 metric tonnes for the week ended Feb. 15, in line with the 300,000-700,000 expected by analysts.

 

Wheat has moved so far to the upside so quickly that it could run out of gas and see a correction in the near term, Gartner said.

 

CBOT May wheat settled 17 1/2 cents above last Friday's settlement.

 

On daily open auction technical charts, CBOT May traded an inside day, with the high and low within Thursday's price range.

 

In CBOT trades, Man Financial bought 1,000 May, Fimat sold 1,000 May and Iowa Grain sold 300 May.

 

Commodity fund selling was estimated at 1,000 contracts.

 

 

Kansas City Board of Trade

 

Hard red winter futures ended lower as participants took some profits after the rally earlier in the week, a KCBT commission house broker said. Corn futures broke late and hard red wheat futures followed with prices at their lows of the session at the close, he added.

 

Activity was modest compared to the previous day's trading, the broker said.

 

On daily open auction technical charts, May wheat remained above its major moving averages.

 

 

Minneapolis Grain Exchange

 

Spring wheat futures finished lower with the exception of the spot month March contract, which ended higher on light buying interest on the close, a commercial connected trader said. Profit-taking and light commercial-related selling weighed on the deferred contracts, the trader said.

 

In MGE trades, ADM bought 400 May, and JP Morgan bought 200 December and sold 200 March.

 

On daily open auction charts, May spring wheat traded an inside day but remained above its major moving averages.

 

On Friday afternoon, the Commodity Futures Trading Commission is scheduled to release the weekly Commitments of Traders report for the period ended Feb. 20.

 

On Monday, the USDA is scheduled to release the weekly export inspections report at 11 a.m. EST (1700 GMT).