US Wheat Review on Wednesday: Up on planting delays, support from corn, soy

 

 

U.S. wheat futures markets closed modestly higher Wednesday. The markets were supported by firmer corn and soybean futures prices, bullish outside markets and planting delays in northern U.S. plains states.

 

July Chicago wheat closed up 4 1/2 cents at US$5.58. July Kansas City wheat futures closed up 8 1/4 cents at US$6.07 a bushel. Minneapolis wheat futures closed up 1 1/2 cents a bushel at US$6.77 3/4.

 

The key "outside markets" turned to a bullish posture for wheat as the session wore on, as the U.S. dollar weakened, crude oil turned solidly higher and the U.S. stock indexes were also higher. Look for the wheat markets to continue to follow corn and soybeans in the near term, said an analyst.

 

Gains in wheat were limited Wednesday by slow export demand for U.S. wheat and the Kansas wheat tour showing a crop in generally good condition, said Shawn McCambridge, veteran analyst with Prudential in Chicago.

 

Scouts on the annual Wheat Quality Council HRW tour found an average yield of 43 bushels per acre in central and northern Kansas, compared with 45.4 an acre from similar routes last year. That suggests an "average" Kansas wheat yield. Day one samples uncovered very little disease pressure or damage to the crop. Day two of the tour takes scouts through western and southern Kansas.

 

Informa Economics on Wednesday projected the 2009 winter wheat crop at 1.535 billion bushels, which would be 333 million bushels below last year's total, according to reports. The winter yield is projected at 45 bushels per acre, down from 47.2 bushels last year. The private analytical firm is projecting hard red winter wheat production of 882 million bushels, down 153 million bushels from last year, with a yield of 37.7 bushels per acre, down from last year's 40-bushel-per-acre yield. Soft red winter wheat production is forecast at 436 million bushels, 178 million below last year's output, with a yield of 61.6 bushels per acre, identical to last year.

 

In other news, the main wheat belt in Australia still needs rain, with no precipitation in the near-term forecast, said ag officials for the state of Western Australia. "Weather forecasts for May suggest no significant rain over agricultural areas until after mid-month, implying an average-to-late start to the growing season. Over the past five years, Western Australia has accounted for more than 40% of Australia's annual wheat production.

 

 

Kansas City Board of Trade

 

In the southern U.S. plains hard red winter regions, it was mostly dry the past 24 hours with a few scattered showers. Showers and scattered thunderstorms are forecast for the region the next 48 hours.

 

 

Minneapolis Grain Exchange

 

Weather in the northern U.S. plains spring wheat regions has been mostly dry with a few scattered light showers the past 24 hours. The forecast call for continued dry weather the next 48 hours. That will allow some planting of the HRS wheat crop.