US Wheat Review on Friday: Rises on technicals, fund buying, weather

 

 

Technical and fund buying combined with worries about frigid weather to push U.S. wheat futures higher Friday, analysts said.

 

Chicago Board of Trade May wheat closed 13 cents higher at US$5.63 1/2 a bushel, up 56 1/4 cents on the week. Kansas City Board of Trade May wheat closed up 16 cents at US$6.07 1/2, and Minneapolis Grain Exchange May wheat closed up 12 1/4 cents at US$6.71 1/2.

 

The gains followed a strong rally in the markets Thursday. Commodity funds bought an estimated 4,000 contracts at the CBOT.

 

There was talk about a blast of cold air headed for U.S. soft red winter wheat and hard red winter wheat areas early next week, said Dale Durchholz, analyst for AgriVisor. The cold may not damage wheat much, but "it's just the emotion of having a wave of cold weather, and fairly bitter cold too," that supported prices, he said.

 

The SRW wheat belt will be coldest Tuesday morning, with temperatures in the upper-20s Fahrenheit probable across much of central and northern Arkansas, according to a forecast from T-Storm Weather. All SRW wheat to the north will be in the 20s, the private weather firm said.

 

"With the acreage being down this year ... you just have a crop that you can ill-afford to throw any damage at it," Durchholz said. U.S. winter wheat plantings are down from last year following a drop in prices.

 

CBOT May wheat closed near its open outcry session high of US$5.65.

 

 

Kansas City Board of Trade

 

KCBT wheat led the upside throughout the day session. There was some local buying that supported the market early, a floor trader said.

 

It's normal for KCBT wheat to widen its premium over CBOT wheat at this time of year, said Tom Leffler, analyst for Leffler Commodities. KCBT May wheat hit an open outcry session high of US$6.10 and closed up 57 1/2 cents on the week.

 

Monday morning will be the coldest across the HRW wheat belt, with temperatures expected to drop below freezing across most of the central and southern Plains, T-Storm Weather said. Temperatures in Oklahoma and Texas will most likely range from 26 degree to 30 degrees Fahrenheit on Monday morning, the weather firm said.

 

 

Minneapolis Grain Exchange

 

MGE wheat finished firmer with the other markets. Wet soil and flooding continue to be concerns for the approaching spring wheat planting season in the U.S. northern Plains, analysts said.

 

Traders will check on weather forecasts when they return from the weekend Monday to see whether a drier trend is developing in the region, an analyst said. A continuation of cold, wet weather could prompt farmers to plant other crops instead of spring wheat, which is valued for its high protein content.

 

MGE May wheat closed near its session high of US$6.73 3/4. The contract ended up 63 3/4 cents on the week.