US Wheat Review on Monday: Closes firmer but off session highs

 

 

U.S. wheat futures finished firmer but well off session highs Monday as early support evaporated amid a lack of bullish fundamentals, traders said.

 

Chicago Board of Trade December wheat closed up 1 1/2 cents at US$4.42 3/4 a bushel. Kansas City Board of Trade December wheat rose 2 1/4 cents to US$4.61 3/4, and Minneapolis Grain Exchange December wheat gained three cents to US$4.81.

 

CBOT December wheat closed nearly a dime below its electronic high of US$4.52. Wheat had climbed earlier in a bounce from recent losses, with some spillover support seen from rallies in neighboring CBOT corn and soy, traders said.

 

Wheat doesn't have bullish fundamentals to underpin gains, as world supplies are seen as large and demand hasn't been overly impressive, traders said. Analysts continue to recommend that market participants sell rallies in wheat.

 

"At least we're not going down," said Greg Wagner, senior commodity analyst for AgResource. "At least we held recent lows, so that's encouraging."

 

CBOT December wheat on Friday set a fresh contract low of US$4.39 1/4. The markets have set contract lows repeatedly during the past month and a half due to bearish fundamentals.

 

Strengthening Black Sea wheat values may have helped prop up wheat Monday, Wagner said. The U.S. and Black Sea compete for export business on the world market, and the Black Sea is known for offering low-cost wheat.

 

CBOT corn ended firmer but off its highs, while soy finished unchanged to lower in a setback. Commodity funds bought an estimated 2,000 wheat contracts at the CBOT.

 

 

Kansas City Board of Trade

 

Traders will take a look at the U.S. Department of Agriculture's weekly crop progress report, due out at 4 p.m. EDT, for an update on winter wheat planting. Citigroup estimated U.S. seeding would be 51% complete, compared to 36% a week ago.

 

This week, hard red winter wheat planting in the central and southern Plains should slow Thursday due to rain, according to private weather firm T-Storm Weather. Frosts and/or freezes may clip some wheat this weekend, although warming will follow late next week to improve conditions for planting, the firm said in a forecast.

 

 

Minneapolis Grain Exchange

 

MGE wheat closed higher in a bounce from recent losses, traders said. The December contract closed off its session high of US$4.90 3/4.

 

In other news, weekly U.S. wheat export inspections of 18 million bushels were within trade estimates of 16 million to 23 million.