US Wheat Review on Thursday: Extends losses on harvest progress

 

 

U.S. wheat futures stumbled Thursday as warm, dry weather continued to speed up U.S. winter wheat cutting.

 

Chicago Board of Trade September wheat dropped 6 1/4 cents to US$5.61 1/2 a bushel. Kansas City Board of Trade September wheat lost 5 1/4 cents to US$6.02 1/2, and Minneapolis Grain Exchange September wheat slid 13 3/4 cents to US$6.73.

 

The markets touched fresh lows for the recent downtrend, with CBOT September wheat hitting an open outcry session low of US$5.56. That was its lowest price since April 29.

 

Prices could weaken further as the harvest continues, although markets are technically oversold and due for a recovery, an analyst said. CBOT September wheat has fallen US$1.40 1/2 since hitting a session high of US$7.02 on June 1.

 

It's difficult for prices to bounce as combines are rolling, analysts said. Cutting is underway in Washingtonne County in southern Illinois, said Dave Marshall, an independent marketing advisor and commodities broker in Nashville, Ill.

 

"We are seeing some fairly rapid harvest progress," he said.

 

There continue to be concerns about soft red winter wheat quality and test weights due to rainy weather that encouraged diseases like head scab, Marshall said. SRW wheat with low test weights and scab problems is being priced to move into animal feed channels, he said.

 

Commodity funds sold an estimated 3,000 contracts at the CBOT.

 

There was some positioning noted ahead of the expiration of July options Friday, traders said.

 

 

Kansas City Board of Trade

 

KCBT September wheat briefly traded below US$6 and hit an open outcry session low of US$5.97, its lowest price since April 30. The contract has dropped US$1.34 1/2 since climbing to US$7.37 on June 1.

 

Active harvesting in Kansas weighed on KCBT wheat amid expectations that cutting will continue through the weekend, traders said. Heat is expected from Nebraska southward into the southern Plains early next week, according to a forecast from T-Storm Weather.

 

In other news, weekly U.S. wheat export sales for the week ended June 18 were 368,300 tonnes, a figure within trade expectations of 200,000 tonnes to 400,000 tonnes. In other news, Egypt's state-owned General Authority for Supply Commodities said it bought 60,000 metric tonnes of French wheat and none from the U.S.

 

 

Minneapolis Grain Exchange

 

MGE wheat led the downside, closing with double-digit losses. September wheat closed near its session low of US$6.72 3/4.