US Wheat Review on Thursday: Slips in late trade on corn, soy pressure

 

 

U.S. wheat futures slipped in late trading Thursday on pressure from neighboring markets after scoring fresh weekly highs earlier in the day.

 

Chicago Board of Trade September wheat finished 1 1/2 cents lower at US$5.33 1/4 a bushel. Kansas City Board of Trade September wheat ended down 1 cent at US$5.59 1/2, and Minneapolis Grain Exchange September wheat lost 4 cents to US$6.15.

 

The markets came under pressure from "persistent selling in the row crops," an analyst said. CBOT November soys closed down 14 1/2 cents, and December corn fell 12 1/4 cents.

 

Earlier in the session, short covering at the CBOT helped pull wheat higher, traders said. Non-commercial speculative funds hold a large net short position in CBOT wheat.

 

Before pulling back, CBOT September wheat set a fresh open outcry high for the week of US$5.49, topping Wednesday's high of US$5.48. The weaker close keeps alive a see-saw pattern for the week, as wheat ended higher Monday, lower Tuesday and higher Wednesday.

 

Commodity funds were seen as even at the CBOT at the close of trading. They were reported to be net buyers earlier in the session.

 

Weekly U.S. wheat export sales of 422,500 tonnes were within trade estimates but seen as "friendly" because they improved from recent weeks, an analyst said. Stronger sales show the U.S. has become price-competitive for export business on the world market, he said.

 

 

Kansas City Board of Trade

 

Pressure from sinking corn and soys weighed on KCBT wheat, traders said. There has been some hedging of new-crop winter wheat lately when prices rise, an analyst said. The U.S. winter wheat harvest is wrapping up.

 

Improved export sales are encouraging for those looking for wheat to find a seasonal bottom, an analyst said. The modest pick-up in business shows prices "don't need to go lower to get demand," he said.

 

Sales of 332,800 tonnes of hard red winter wheat, in particular, were solid, a trader said. By comparison, sales of soft red winter wheat were 70,000 tonnes and sales of hard red spring wheat were 15,800 tonnes, according to the U.S. Department of Agriculture. HRW is traded at the KCBT, while SRW wheat is traded at the CBOT and HRS wheat is traded at the MGE.

 

 

Minneapolis Grain Exchange

 

MGE was the first market to slip lower Thursday. The weakness was a turnaround from Wednesday, when MGE September wheat gained slightly more ground than CBOT or KCBT wheat.

 

Some old-crop spring wheat is being marketed as harvest approaches, although producers are "not happy with the prices," an analyst said. There is "still plenty of old crop out there that hasn't hit the market yet," he said.