US Wheat Review on Thursday: Sags on bearishness about ample supplies

 

 

U.S. wheat futures finished weaker Thursday on bearishness about large world supplies but trimmed losses before the close.

 

Chicago Board of Trade December wheat ended down 3 3/4 cents at US$5.03 per bushel. Kansas City Board of Trade December wheat lost 2 1/4 cents to US$5.24 3/4, and Minneapolis Grain Exchange December wheat closed down 4 1/2 cents at US$5.50 3/4.

 

A 1.2% increase in the International Grain Council's 2009-10 world wheat production estimate from July encouraged ideas that global supplies are "plentiful," said Dave Marshall, an independent marketing advisor and commodities broker. The IGC pegged production at 662 million tonnes due to higher-than-expected yields in several regions.

 

"Whatever we've got in the United States is more than enough for our needs," Marshall said. "It's been difficult to get markets interested to own wheat."

 

Wheat slumped after trading both sides in early activity but pared losses in late dealings. A rally in nearby CBOT soy helped wheat recover some of its losses, a trader said.

 

Commodity funds sold an estimated 2,000 wheat contracts at the CBOT.

 

Traders are starting to look ahead to first notice day for September contracts on Aug. 31. Deliveries for CBOT wheat are expected to be heavy.

 

 

Kansas City Board of Trade

 

KCBT wheat slumped even though weekly U.S. wheat export sales of 652,700 tonnes were a marketing-year high and topped expectations. Of the total, sales of hard red winter wheat, traded at the KCBT, accounted for 256,700 tonnes, and sales of soft red winter wheat, traded at the CBOT, accounted for 147,900 tonnes, the U.S. Department of Agriculture said. Sales of hard red spring wheat, traded at the MGE, were 154,500 tonnes.

 

More demand is needed after a slow start to the marketing year, traders said. There is plenty of competition for export business because of large global supplies.

 

"We had a decent weak of export sales, and it was about time," the analyst says.

 

 

Minneapolis Grain Exchange

 

MGE wheat sagged with the other markets amid expectations that the pace of U.S. spring wheat cutting will pick up in the next week, traders said. Yields are expected to be high, although there continue to be worries that protein levels may slip, they said. Harvest is off to a slow start due to late planting.