US Wheat Review on Friday: Falls on weak demand, following corn, soy

 

 

U.S. wheat futures tumbled Friday and closed near session lows on spillover selling from neighboring markets and an absence of export demand.

 

Chicago Board of Trade December wheat ended down 15 cents at US$4.97 1/4 a bushel, up 3 cents on the week. Kansas City Board of Trade December wheat lost 16 1/2 cents to US$5.01, and Minneapolis Grain Exchange December wheat sank 10 1/4 cents to US$5.18 1/4.

 

Wheat's fundamentals are weak, with world supplies considered large and export demand seen as lackluster. Friday's selloff extended losses from Thursday and was "follow-through on the idea that we are having an incredibly difficult time trying to move the wheat export program forward," said Dave Marshall, an independent marketing advisor and commodities broker.

 

"The demand side of the market continues to be very sluggish," he said.

 

Weekly U.S. wheat export sales, announced Thursday, were 284,500 tonnes, below trade expectations of 300,000 tonnes to 500,000 tonnes. Egypt's General Authority for Supply Commodities, meanwhile, bought French and Russian wheat in a tender Thursday and none from the U.S.

 

"The most frustrating thing about last week's sales was not that they weren't better than trade expectations but that they showed no major progress, even though we saw a major sell-off last weak," Marshall said. "We still have competitors who have readily available supplies that are much closer to the source of the demand."

 

CBOT December wheat finished near its session low of US$4.96 1/2. Commodity funds sold an estimated 4,000 contracts at the CBOT.

 

 

Kansas City Board of Trade

 

KCBT December wheat closed near its session low of US$5.00 1/2. The contract ended up 2 cents on the week.

 

Wheat followed CBOT corn and soy lower as the markets felt pressure from warmer, drier weather in the central U.S., traders said. Producers are advancing the corn and soy harvests and making progress on winter wheat planting, they said.

 

In outside markets, crude-oil futures dropped to a one-week low Friday after the U.S. unemployment rate rose to a 26-year high. That didn't help the grains, traders said.

 

 

Minneapolis Grain Exchange

 

MGE December wheat closed near its session low of US$5.17 3/4. It finished up 5 1/2 cents on the week.

 

Traders are looking ahead to U.S. Department of Agriculture crop reports due out at 8:30 a.m. EST Tuesday. The government resurveyed wheat producers in the northern Plains and may update its hard red spring wheat and durum production estimates. Updated carryout estimates also are due to be released.