US Wheat Review on Wednesday: Retreat on outside market pressure

 

 

U.S. wheat futures backpedaled Wednesday, succumbing to speculative selling once again amid weakness from outside financial markets and an absence of fresh supportive influences.

 

September CBOT wheat ended 4 3/4 cents lower at US$5.11 1/2, September KCBT wheat settled 3 1/2 cents lower at US$5.46 1/2, and September MGE wheat finished 2 1/4 cents lower at US$5.98 1/4.

 

The influence of sharp declines in crude oil futures, a firmer U.S. dollar, price pressure in metals and world equity markets served as catalysts to keep buyers sidelined, a CBOT floor analyst said.

 

Bearish crop and yield reports from scouts trekking across spring wheat fields in North Dakota added to the defensive tonnee, with lagging export demand and spillover weakness from neighboring corn futures for most of the day weighed on prices.

 

Technical selling added to the losses, with declines accelerating once active contracts slipped below their prior lows to uncover pre-placed sell orders, traders said.

 

Otherwise, activity was subdued with the bearish impact of outside markets keeping prices firmly planted in negative territory.

 

In CBOT pit trades, speculative fund selling was estimated at 2,000 lots.

 

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

 

Crop scouts on one leg of the 2009 Hard Spring Wheat and Durum Tour on Wednesday saw more plants with the potential to produce stronger-than-normal yields. Scouts on the annual tour fanned out from Mandan, N.D., to survey fields for a second full day. The tour began Tuesday in Fargo, N.D.

 

Crop scouts will meet up Wednesday night in Devils Lake, N.D., to compare notes. The tour wraps up Thursday in Fargo, when a final yield estimate will be released.

 

On tap for Thursday, the U.S. Department of Agriculture weekly export sales report is scheduled to be released at 8:30 a.m. EDT, and analysts surveyed by Dow Jones Newswires estimate wheat sales for the week ended July 23 in a range of 200,000 to 500,000 metric tonnes.

 

 

Kansa City Board of Trade

 

KCBT wheat futures ended lower, maintaining a bearish theme on outside financial market weakness and a lack of bullish demand news to spark upside momentum.

 

 

Minneapolis Grain Exchange

 

MGE wheat futures finished lower, retreating in step with the rest of the wheat complex, with bearish spring and durum wheat crop reports adding to an already weak tonnee.