US Wheat Review on Monday: Early rally fades; wheat closes down

 

 

Bullish wheat sentiment, which reflected a corn rally early in Monday's wheat trading, all but evaporated when the market closed.

 

Chicago Board of Trade July wheat closed down 5 1/2 cents at US$8.76 1/2 per bushel. Kansas City Board of Trade July wheat dropped 3 1/4 cents to US$9.21, and Minneapolis Grain Exchange July wheat shed 6 3/4 cents to US$9.70 1/4.

 

The CBOT closing price marks the first ever set by electronic Globex trade.

 

There was "good trading" 40 minutes into the trading day, but "this market just lost steam," a CBOT floor trader said.

 

Wheat futures still trade at sharply inflated levels relative to cash prices and will likely stay that way for another month or so, another CBOT trader said.

 

"We need to get through about 50% harvest, the 4th of July, and a few weeks of negative export reports before people start getting worried about the value of wheat," the trader said.

 

With wheat at its current inflated levels, U.S. marketers will have a tough time moving their stocks, the trader said.

 

An AgriCharts commentary prepared by Brugler Marketing and Management noted that weekly export inspections of 14.665 million bushels were slightly below estimates.

 

Funds bought 3,000 contracts at the CBOT.

 

 

Kansas City Board of Trade

 

Cool, wet weather has slowed down the hard red winter wheat harvest in southern Kansas, according to a recent Kansas Wheat Harvest Report.

 

In Barber County, which was the first to begin harvest in the state, farmers have cut about two-thirds of their wheat, said Alan Meyers of Kiowa's OK Coop Grain Company. Meyers said yields are "favorable," and protein levels are "running over 12%." His area needs about three or four days of favorable weather to finish up harvest, he said.

 

Rain over the weekend "will keep farmers out of the fields for a couple of days," said Carla Ward of the Farmers Coop Grain Company in Caldwell, which took its first load less than a week ago.

 

Test weights have averaged 59 pounds per bushel, she said.

 

 

Minneapolis Grain Exchange

 

Like, the rest of the wheat complex, MGE wheat futures generally followed corn, a MGE floor trader said.

 

But the market "felt heavy" and was unable to hold on to an earlier rally that pushed the nearby contract to the day's high of US$10.03.