US Wheat Review on Monday: Falls on spillover, harvest; funds sell

 

 

Pressure from other markets and expectations for harvest progress pushed down U.S. wheat futures on Monday.

 

Chicago Board of Trade September wheat ended down 9 1/2 cents at US$5.75 a bushel. Kansas City Board of Trade September wheat lost 11 1/4 cents to US$6.14, and Minneapolis Grain Exchange September wheat fell 6 cents to US$6.89 3/4.

 

Wheat felt pressure from losses in CBOT corn and soys as gains in the dollar weighed on commodities, a trader said. December corn closed down 14 cents at US$4.05 1/2, while November soys sank 25 cents to US$9.81. Weakness in crude oil and equities added pressure to the markets.

 

Follow-through technical selling was a feature after CBOT wheat closed below its 100-day moving average Thursday and Friday, an analyst said. The market is eyeing its April or March lows, which would be US$5.41 1/2 or US$5.39 for CBOT September wheat.

 

September wheat hit an open outcry session low of US$5.71 1/4, its lowest price since April 30, before paring losses a bit. Commodity funds sold an estimated 4,000 contracts at the CBOT.

 

 

Kansas City Board of Trade

 

Pressure from outside and neighboring markets set the tonnee for KCBT wheat, traders said. Harvest is expected to resume this week after rain halted cutting in parts of Kansas.

 

Warmer, drier weather is expected to open the door for cutting across the U.S. Plains and in the southern Midwest, analysts said. Wheat harvest is "ready to explode" across Kansas, with expectations for above-average harvest sales, MF Global said in a note.

 

U.S. winter wheat harvest should be 18% complete in the U.S. Department of Agriculture's weekly crop progress report, due out at 4 p.m. EDT, Citigroup said. A week ago, 9% of the crop was cut.

 

 

Minneapolis Grain Exchange

 

MGE wheat felt pressure from the other markets but saw more modest losses than at the CBOT and KCBT, traders said. MGE wheat led the downside Friday.

 

Traders are waiting to see an acreage update due out Wednesday from Statistics Canada. Industry members estimate all-wheat area at 23.5 million to 25.2 million acres, compared with 25.2 million in April.

 

Showers in the Canadian Prairies during the weekend "provided some relief from dryness in key spring wheat areas," according to Cropcast Agricultural Weather. However, more rain is needed, "especially considering the warm temperatures expected there this week," the private weather firm said in a forecast.