August 10, 2006

 

US Wheat Review on Wednesday: End up; CBOT leads on overdone ideas

 

 

U.S. wheat futures ended higher Wednesday, with Chicago Board of Trade futures leading the gains on oversold ideas and pre-report positioning.

 

CBOT September wheat futures ended 4 cents higher at US$3.88, September Kansas City wheat settled 1 3/4 cents higher at US$4.71 1/2 and Minneapolis September wheat ended 3/4 cent per bushel higher at US$4.72.

 

Aside from the fact that no spillover price pressure from corn and soybeans was inflicted on wheat futures Wednesday, the market was buoyed by oversold ideas following recent declines, said John Kleist of Kleist Agricultural Consulting.

 

Overall activity was relatively quiet, with many traders content to sit on the sidelines until Friday's U.S. Department of Agriculture production and supply and demand reports, analysts added.

 

CBOT September futures have fallen near the US$3.80 per bushel level, a price area that sparked export demand previously, said Kleist. The declines are raising thoughts of attracting demand as prices become more competitive in world markets, he adds.

 

On tap for Thursday, USDA is scheduled to release its weekly export sales report 7:30 a.m. CDT. Analysts look for wheat commitments in the range of 350,000 to 550,000 metric tonnes.

 

In CBOT pit trades, Calyon Financial, Man Financial and JP Morgan each bought 1,000 December and Fimat bought 2,000 December. Calyon Financial and JP Morgan each sold 1,000 September, and Fimat sold 2,000 September.

 

 

KANSAS CITY BOARD OF TRADE

 

KCBT wheat futures experienced light volume two-sided session. Early speculative fund selling weighed on prices, but the exhaustion of those sales near midday attracted light buying, enabling futures bounce higher for the remainder of the day, analysts say. Otherwise, traders are looking ahead to Friday's crop reports, looking to limit risks.

 

Fimat bought 200 September and 400 December, JP Morgan was a buyer of 300 September and 300 December, with Frontier a buyer of 400 December. Man Financial sold 300 September and 600 December, Prudential sold 600 September and 300 December. UBS Securities sold 500 December.

 

 

MINNEAPOLIS GRAIN EXCHANGE

 

MGE wheat futures ended slightly higher, in tune with other wheat markets, as futures consolidated Tuesday's declines.