US Wheat Review on Monday: Rallies late as funds buy

 

 

Late fund buying on the first trading day of the month pushed U.S. wheat futures sharply higher Monday, traders said.

 

Chicago Board of Trade December wheat rallied 22 1/2 cents to US$5.16 3/4 a bushel. Kansas City Board of Trade December wheat soared 21 cents to US$5.20, and Minneapolis Grain Exchange December wheat climbed 18 1/4 cents to US$5.31.

 

Wheat surged late with neighboring CBOT corn and soy as money came into the markets on the first trading day of the month, a floor analyst said. Commodity funds bought an estimated 5,000 wheat contracts at the CBOT.

 

"New money, new month," the floor analyst said.

 

There had been some chatter that funds would buy in late dealings, and there seemed to be some buying in anticipation of it, a floor trader said. Supportive fundamental news was scarce, as world wheat supplies remain large.

 

Weather for the U.S. Midwest looks drier this week than last week, which should help producers advance soft red winter wheat seeding and the corn and soy harvests, according to T-Storm Weather. Planting rates should improve through the weekend, the private weather firm said.

 

SRW wheat planting has been delayed because rain has slowed the soy harvest. Many producers plant SRW wheat after soy in the Midwest and Delta.

 

 

Kansas City Board of Trade

 

Fund buying ahead of the close of trading carried KCBT wheat higher after the market saw more modest gains earlier in the session, traders said. Weakness in the U.S. dollar had helped underpin gains earlier, they said.

 

The U.S. Department of Agriculture is slated to issue an update on U.S. winter wheat plantings at 4 p.m. EST in its weekly crop progress report. Planting is estimated to be 81% complete, up from 76% a week ago, according to Citigroup.

 

 

Minneapolis Grain Exchange

 

MGE wheat finished higher, trailing gains at the CBOT and KCBT. The markets did not get a boost from export news, as the demand front remained quiet, traders said.

 

Weekly U.S. wheat export inspections of 11.933 million bushels were below trade estimates of 14 million to 19 million. The U.S. has faced strong competition for export business because there is a lot of wheat to go around. Higher prices make U.S. wheat less competitive on the world market, a trader said.