March 10, 2007

 

US Wheat Review on Friday: Ends mixed, unable to sustain light gains

 

 

U.S. wheat futures settled mixed Friday in choppy trading with the market unable to maintain gains established near midday, a floor analyst said.

 

CBOT May wheat rose 1 cent to US$4.76 1/2. KCBT May wheat slipped 1/4 cent lower to US$5.02, and MGE May wheat settled 1 cent higher at US$5.14 1/2.

 

Friday's U.S. Department of Agriculture supply and demand report produced little fresh news to trade on, and the market traded on both sides of unchanged early in the session, the analyst said.

 

The USDA estimated 2006-07 wheat ending stocks at 472 million bushels, unchanged from its February estimate.

 

Light fund buying and position squaring helped lead the market higher after midday, however, most of the gains were extinguished before the closing bell, a floor trader said.

 

People wanted to liquidate their positions ahead of the close with some participants nervous about holding a position over the weekend given the recent volatility in equity and commodities markets, said Jack Scoville, vice president and analyst at Price Futures Group.

 

Overall, wheat remains in its recent trading range as the USDA report was neutral, export demand is quiet and the weather is favorable for the new crop, Scoville said.

 

Weaker corn futures also weighed on wheat in late trade, the floor trader said.

 

May corn fell 4 cents to US$4.17 per bushel.

 

Wheat will continue to struggle until it can find some fresh news or the other grains rally, Scoville said.

 

In CBOT trades, Iowa bought 800 May, UBS bought 400 July and 200 May and sold 300 May.

 

Overall fund buying was estimated at 1,000 contracts.

 

On daily open auction technical charts, May settled below most major moving averages.

 

 

Kansas City Board of Trade

 

Hard red winter wheat futures finished with thin losses in most months in quiet activity, a floor trader said.

 

Trading was sideways for most of the day with no direction except for light spillover support from the gains in CBOT wheat for part of the day, a KCBT floor analyst said. Outright trade and spread trade was light and forecasts for rain late in the weekend also added light pressure, he added.

 

On open auction technical charts, May traded an outside day with a higher high and a lower low than Thursday's price range, but remained within its recent price levels.

 

 

Minneapolis Grain Exchange

 

Spring wheat futures finished with thin gains in very quiet activity as strength in CBOT wheat provided some spillover support, an MGE floor broker said. "There was no definition in trading," the broker said. This morning's USDA report had little impact with the market waiting on the spring wheat planting intentions due out at the end of the month, an MGE floor trader said.

 

Friday afternoon, the Commodity Futures Trading Commission is scheduled to release the weekly commitment of traders report for the period ended March 6.

 

Monday, the USDA is scheduled to release the weekly export inspections report at 11:00 a.m. EDT (1500 GMT).