US Wheat Review on Tuesday: Closes lowers after trading both sides

 

 

U.S. wheat futures closed lower on profit-taking and spillover pressure Tuesday after trading both sides in a directionless session.

 

Chicago Board of Trade December wheat closed down 1/4 cent at US$5.17 1/2 a bushel. Kansas City Board of Trade December wheat lost 3 cents to US$5.25 3/4, and Minneapolis Grain Exchange December wheat sank 6 1/4 cents to US$5.35 1/4.

 

Profit-taking and losses in neighboring CBOT corn and soy weighed on wheat, traders said. The grain and soy markets pulled back following rallies Monday.

 

CBOT and KCBT wheat temporarily traded higher after midday but sagged again before the close. Technical charts look supportive after recent gains, a CBOT floor trader said.

 

CBOT December wheat looks "resilient" after trading both sides and fighting off steeper losses, he said. December corn fell 1 3/4 cents, and November soy dropped 13 3/4 cents.

 

Nearby resistance for CBOT December wheat is seen at US$5.35, a market analyst said. Support is seen at US$4.90, he said.

 

There are concerns about delayed soft red winter wheat plantings due to the late soy harvest. Growers in parts of the Midwest and south often plant SRW wheat, used to make pastries and snack foods, after soy. Wet weather and late spring planting have put the soy harvest behind schedule.

 

Winter wheat was 69% planted as of Sunday, up five percentage points from a week earlier and below the average of 78%, the U.S. Department of Agriculture said. The crop was 48% emerged, compared to 39% last week and the average of 54%.

 

A drop in SRW wheat acres would be viewed as bullish, but large world supplies will make it difficult for the market to generate a longer-term bullish outlook, said Louise Gartner, analyst for Spectrum Commodities. World wheat ending stocks are considered to be more than enough to meet demand.

 

 

Kansas City Board of Trade

 

KCBT wheat closed lower after trading both sides in choppy activity. Wheat looked to be consolidating after Monday's gains, a trader said.

 

Strength in the U.S. dollar put pressure on the grains after a weak greenback underpinned gains Monday, a trader said. Losses in crude oil added to the bearish tonnee Tuesday, he said.

 

 

Minneapolis Grain Exchange

 

MGE wheat led the downside in a retreat from Monday's strength. The market gave back less than half its gains after MGE December wheat closed up 15 cents Monday.