March 9, 2007

 

US Wheat Review on Thursday: Ends mixed; unable to sustain light gains

 

 

U.S. wheat futures finished mostly lower Thursday in choppy, two-sided trade.

 

Light position squaring ahead of Friday's U.S. Department of Agriculture supply and demand report helped provide early support for prices, but the lack of additional buying near session highs led to local trader selling, a floor analyst said.

 

CBOT May wheat fell 2 1/2 cents to US$4.75 1/2, KCBT May wheat slipped 1/4 cent lower to US$5.02 1/4, and MGE May wheat settled 1/4 cent higher at US$5.13 1/2.

 

The market was unable to sustain the gains ahead of Friday's USDA report, said Shawn McCambridge, senior grain analyst with Prudential Financial.

 

U.S. wheat ending stocks for the 2006-07 marketing year are estimated at 473 million bushels, according to a survey of 12 analysts conducted by Dow Jones Newswires, up 1 million bushels from the USDA's February estimate.

 

Over the past several sessions volume has declined as participants have moved to the sidelines waiting for fresh news, McCambridge said.

 

Wheat was following corn to a certain extent, and when nearby corn turned lower, wheat followed, the floor analyst said.

 

News that Argentina had suspended new wheat and wheat flour exports had little market impact as Argentina has already sold the bulk of its crop, so the move isn't expected to have much impact, a commission house analyst said.

 

Without any major changes in Friday's USDA report the choppy, sideways pattern in wheat should continue in the near-term, said McCambridge.

 

In CBOT trades, Fimat bought 500 May and Iowa Grain sold 400 May.

 

Overall fund selling was estimated at 1,000 lots.

 

 

Kansas City Board of Trade

 

Hard red winter wheat futures ended fractionally lower in most months in a choppy, volatile session, a floor analyst said. The market was a little firmer than expected early on but was unable to hold above Wednesday's settlement prices, they said. There was some interest in buying deferred KCBT and selling CBOT deferred wheat contracts, they added.

 

In KCBT trades, JP Morgan bought 200 May, and Fimat bought 200 May. Frontier sold 200 May, JP Morgan sold 200 May and Man Financial sold 300 May and 400 July.

 

On open auction technical charts, May remained within its recent trading range.

 

 

Minneapolis Grain Exchange

 

Spring wheat futures ended fractionally higher in a "pretty quiet" session, a floor broker said. The market flopped around on both sides of unchanged in a featureless trade, the broker added.

 

On daily open auction technical charts, May wheat settled above most major moving averages but remained within its recent trading range.

 

Friday the USDA is scheduled to release the March supply and demand report at 8:30 a.m. EST (1330 GMT).