US Wheat Review on Tuesday: Mostly lower; lacks supportive influence

 

 

U.S. wheat futures finished mostly lower Tuesday, with Chicago and Kansas City wheat unable to sustain early advances amid a lack of fresh supportive influences.

 

September CBOT wheat ended 4 1/4 cents lower at US$5.16 1/4, September KCBT wheat settled 1 3/4 cents lower at US$5.50, and September MGE wheat finished 3 cents higher at US$6.00 1/2.

 

A general lack of fresh demand, lower crude oil futures and the stalling of a midday rally in soys left most wheat futures without a crutch to support early price gains, a CBOT floor analyst said.

 

Futures initially found good technical support on oversold market conditions, with end-of-the month short covering and the ability of futures to hold above prior lows uncovering buying interest.

 

Seasonal buying was featured as well, with traders viewing the market's recent bounce from lows as a sign that winter wheat harvest lows were in place, said Brian Hoops, president of Midwest Market Solutions.

 

As the day unfolded, futures lost upside strength on a lack of fresh demand support to attract buying beyond short covering, analysts said. However, spring wheat futures managed to hold onto modest gains, supported by spreads versus other U.S. wheat futures amid lingering uncertainty tied to crops still in the development stage, traders said.

 

Outside markets applied mild pressure to prices as well, with weakness in crude oil futures sending negative waves through the market.

 

In CBOT pit trades, speculative fund selling was estimated at 3,000 lots.

 

The DTN Meteorlogix weather forecast said that in northern Plains spring wheat areas, cooler temperatures and showers should help ease any stress to wheat through the Montana growing areas. Mostly favorable conditions across North Dakota are also in store at this time, although cooler temperatures may slow development of wheat.

 

Meanwhile, crop scouts on one leg of the 2009 Hard Spring Wheat and Durum Tour on Tuesday saw good-looking wheat that reflected the benefits of timely rains, with no major disease threats seen. The annual tour, sponsored by the Wheat Quality Council, kicked off from Fargo, N.D. About 55 participants fanned out along different routes to survey fields in North Dakota and parts of South Dakota and Minnesota.

 

Scouts from all the routes will meet Tuesday night in Mandan, N.D., to compare notes. The tour is slated to issue final yield estimates Thursday afternoon.

 

 

Kansa City Board of Trade

 

KCBT wheat futures ended lower, backpedaling from early gains on a lack of follow-through buying and the absence of fresh demand support to underpin prices, analysts said.

 

 

Minneapolis Grain Exchange

 

MGE wheat futures finished higher, managing to break away from the late slide in neighboring wheat markets amid crop uncertainties and spreading between wheat futures markets.