June 22, 2006

 

US Wheat Outlook on Thursday: Up 1-2 cents on possible technical buying

 

 

U.S. wheat futures were called to open up 1-2 cents per bushel Thursday on possible follow-through technical buying, but gains could be limited by weekly U.S. wheat export sales, brokers said.

 

Net weekly U.S. wheat export sales of 316,200 metric tonnes were 31% below the previous week, brokers said.

 

Moreover, Statistics Canada reported 2006 spring wheat plantings at 20.424 million acres, up 14% from the 2005 tally.

 

Lingering support may also be seen from this week's report of deteriorating U.S. spring wheat conditions and harvest delays in the U.S. hard red winter wheat belt, brokers said.

 

The U.S. Department of Agriculture reported Monday a 7 percentage-point drop in the U.S. spring wheat crop's good-to-excellent condition rating to 60%.

 

Twenty-one percent of the U.S. spring wheat crop was headed.

 

This week's rain-led harvest delays in Kansas, the top U.S. winter wheat producer, also have underpinned KCBT wheat this week.

 

The U.S. winter wheat crop was 38% harvested as of Sunday, more than double last year's tally and 17 percentage points above the five-year average, the USDA said Monday.

 

In the overnight e-CBOT session, most-active September wheat closed up 3/4 cents at US$3.90 per bushel.

 

Kansas City Board of Trade September wheat ended overnight up 1 cents at US$4.92 1/2 per bushel.

 

Cash U.S. hard red winter wheat basis bids were mixed Thursday, with a 9-cent loss in Enid, Okla.; soft red winter wheat basis bids were mixed, with a 4-cent gain in the Kansas City truck bid; and spring wheat basis bids were mixed, with a 30-cent gain in the Minneapolis rail bid and a 2-cent loss in Billings, Mont., grain merchandisers said.

 

In overnight U.S. wheat export news, Japan's Ministry of Agriculture, Forestry and Fisheries has bought 100,000 metric tonnes of wheat, including 60,000 tonnes of U.S. wheat, for Aug. 1-31 shipment.

 

Traders awaited results of a 2.2-million-tonne wheat tender by India. The tender closed on Tuesday, and rumors have circulated that the U.S., Europe and Canada are the major contenders.

 

In other global news, India gave approval for wheat imports by private domestic companies - in addition to the government-owned State Trading Corp. - to rein in inflation, Finance Minister P. Chidambaram said Thursday.