July 25, 2006

 

US Wheat Review on Monday: Lower on profit taking; funds absent

 

 

U.S. wheat futures finished lower Monday, as profit taking and a lack of fresh buying interest combined to weigh on prices in all three U.S. wheat markets, sources said.

 

There was not much interest in trading wheat Monday and little fund support, a CBOT floor analyst said. After last week's gains, some people were interested in trimming some of their longs, he added.

 

Early indications that U.S. spring wheat yields may not be as poor as earlier indicated also weighed on the market, a commission house trader said.

 

Export inspections, released during the session, were above the range of analysts estimates but had little impact. The USDA reported weekly wheat inspections were 17.573 million bushels, above the 10-15 million expected.

 

Talk of better-than-expected yields in both France and Britain after recent poor weather there also added to the weak tonnee, a floor analyst said.

 

CBOT September wheat declined 6 3/4 cents to US$4.00 1/2 and December dropped 5 1/2 cents to US$4.20 3/4.

 

On technical charts December ended below its 10-day and 50-day moving averages.

 

In CBOT trades, JP Morgan bought 400 September, Fimat bought 500 December and Term bought 200 September.

 

ABN Amro sold 400 September, RJ O'Brien sold 300 September, and Rand Financial sold 200 September.

 

Commodity fund selling was estimated at 600 contracts.

 

In spread trading, ABN Amro bought 800 December-September.

 

 

Kansas City Board of Trade

 

KCBT wheat futures finished lower in light trading as weaker prices overnight and light position squaring pressed the market with the lack of fund support also adding to the tonnee, a floor broker said.

 

In midday KCBT trades, JP Morgan bought 200 September and 100 December, ADM bought 150 September. Fimat sold 200 September and Shay Grain sold 100 September.

 

KCBT September fell 6 3/4 cents to US$4.99 1/4 per bushel and December lost 5 3/4 cents to US$5.15 3/4.

 

On day only technical charts, KCBT finished below its 20-day moving average.

 

 

Minneapolis Grain Exchange

 

Spring wheat futures settled lower, undermined by spillover weakness from early losses set in KCBT futures, floor sources said. Light speculative buying, thought to be short covering, helped futures come off their lows near mid-day but there was little in the way of any follow through, he added.

 

MGE September wheat settled 5 3/4 cents lower at US$4.98 1/4 per bushel and December fell 6 1/4 cents to US$5.06.

 

On technical charts, December settled below its 10-day and 20-day moving averages.

 

Minneapolis grain receipts totaled 40 cars of wheat and 21 cars of durum, compared to 189 cars of wheat and 74 cars of durum a year ago.

 

Monday afternoon, the USDA is scheduled to release the weekly crop progress for the week ended July 23 at 3 p.m. CDT (2000 GMT). Traders and analysts expect spring wheat conditions to decline 1 to 3 percentage points in the good-to-excellent category. Last week, 34% of the spring wheat crop was rated in good-to-excellent condition.