US Wheat Review on Monday: Ends up sharply on spillover, weak dollar

 

 

Fund buying and support from neighboring and outside markets pulled U.S. wheat futures sharply higher Monday, despite a lack of fresh fundamental news, traders said.

 

Chicago Board of Trade December wheat closed up 19 cents at US$5.17 3/4 a bushel. Kansas City Board of Trade December wheat finished 18 1/4 cents higher at US$5.28 3/4, and Minneapolis Grain Exchange December wheat ended 15 cents higher at US$5.41 1/2.

 

Commodity funds bought an estimated 4,000 contracts at the CBOT. They also were buyers in neighboring CBOT corn and soy.

 

Non-commercial speculative funds have trimmed shorts in CBOT wheat lately but continue to hold a large net short position, a trader said. They reduced their net short position to 47,603 contracts as of Oct. 13, down from 60,191 contracts as of Oct. 6, according to supplemental Commodity Futures Trading Commission reports.

 

Gains in the neighboring markets provided spillover support for wheat as the row crops rallied on worries that wet weather will delay the U.S. harvest, traders said. Wheat was "just coming along with the crowd," an analyst said.

 

There continued to be chatter that the slow soy harvest is preventing plantings of soft red winter wheat and could prompt some producers to abandon plans to seed wheat. SRW wheat is planted after soy in many parts of the Midwest and South.

 

 

Kansas City Board of Trade

 

Supportive signals from outside markets and firm corn and soy helped lift KCBT wheat, traders said. Weakness in the U.S. dollar and gains in equities, crude oil and metals contributed to a bullish tonnee, an analyst said. A soft dollar makes U.S. grains more attractive to foreign buyers.

 

"The grains are part and parcel of the entire commodities basket," an analyst said.

 

The U.S. Department of Agriculture is slated to issue an update on winter wheat plantings in its weekly crop progress report, due out at 4 p.m. EDT. Plantings are estimated at 76% complete, up from 64%, according to Citigroup.

 

 

Minneapolis Grain Exchange

 

MGE wheat rose with the other markets. MGE trailed gains at the CBOT and KCBT.

 

"The outside markets were not discouraging" strength in the grains, an analyst said.

 

There was a lack of fresh fundamental news to feed on, traders said. Weekly U.S. wheat export inspections of 18.627 million tonnes were within trade expectations, which ranged from 16 million to 21 million.