US Wheat Review on Wednesday: CBOT sags on technical sales as Minneapolis Grain Exchange  jumps

 

 

U.S. wheat futures were a mixed bag Wednesday, with Minneapolis Grain Exchange wheat ending at a seven-month high as Chicago Board of Trade wheat slumped.

 

CBOT July wheat dropped 4 cents to US$5.88 3/4 a bushel. Kansas City Board of Trade July wheat finished up 1/2 cent at US$6.38, and MGE July wheat jumped 8 1/4 cents to US$7.13 1/4.

 

CBOT wheat fell on technical selling after the July contract hit a fresh three-month high near US$6, which was seen as a resistance level, traders said. The contract's open outcry session high was US$5.98 and its electronic high was US$6.02 1/4.

 

"It basically hit a wall," a trader said. "It wasn't a huge wall, but it was enough."

 

Wheat was due for a setback and some profit-taking after recent gains, a CBOT floor analyst said. As of Tuesday's close, CBOT July wheat was up 56 1/4 cents on the month.

 

In other news, a 52,000-tonne shipment of Russian wheat was seized by Egyptian authorities on health concerns, Egyptian traders said. The seizure did not have a noticeable impact on U.S. wheat futures, an analyst said.

 

 

Kansas City Board of Trade

 

KCBT wheat ended near unchanged after trading both sides during the session. There is "no story right this moment" for the market, a KCBT floor trader said.

 

U.S. Department of Agriculture estimates for U.S. winter wheat production and U.S. carryout, issued Tuesday, were below trade expectations. However, the government's projections for world wheat ending stocks were above expectations, indicating there will be plenty of supply to go around, analysts said.

 

"We're kind of struggling with the fundamentals," a KCBT trader said. "We had a technical bounce here of late."

 

The markets are waiting to see weekly U.S. export sales data, due out at 8:30 a.m. EDT Thursday, the KCBT trader said. Wheat export sales have been "rather on the light side" lately, she said. Sales for the week ended May 7 are expected to be 200,000 tonnes to 450,000 tonnes.

 

 

Minneapolis Grain Exchange

 

MGE July wheat hit a session high of US$7.15 1/4, its highest price since Oct. 7.

 

Worries about cool, wet weather delaying spring wheat planting supported the market, traders said. The USDA, in its May supply and demand report, confirmed spring wheat yields for 2009 are expected to be below trend levels in North Dakota and Minnesota, the top two spring wheat-producing states.

 

Conditions look damp for the rest of the week, which will prevent significant planting progress, meteorologists said. The weather should turn more favorable for seeding next week, they said.

 

The northern Plains will see a "marked warm-up" for at least two days early next week, according to a forecast from T-Storm Weather. However, that should "set the stage for at least a few more" thunderstorms, the private weather firm said.