US Wheat Review on Monday: Drops on profit-taking, spillover selling
Profit-taking and spillover pressure from losses in other markets dragged U.S. wheat futures lower Monday in a retreat from recent gains.
Chicago Board of Trade March wheat futures shed 7 1/4 cents to US$5.92 a bushel, near its session low of US$5.89. Kansas City Board of Trade March wheat lost 5 1/4 cents to US$6.11, and Minneapolis Grain Exchange March wheat sank 8 1/4 cents to US$6.44 3/4.
Wheat was due for correction after rallying last week, analysts said. CBOT March wheat on Friday ended up US$1.28 1/4 from its Dec. 5 low of US$4.71.
"Near term, I think you've got overbought conditions in all these markets," said Greg Wagner, senior commodity analyst for AgResource Company. "It's been a pretty good run" to the upside.
The markets last week went out "with a bang and are now just kind of consolidating," Wagner said. Consolidation should continue in the near term, he said.
Weakness in corn and soybeans weighed on wheat, traders said. The markets remained in holiday mode, with light volume, they said.
Kansas City Board of Trade
U.S. wheat futures started higher but shook off early gains. KCBT March wheat closed near its session low of US$6.08. The contract's session high was US$6.36.
Profit-taking and losses in neighboring markets pressured wheat in a "largely news-less environment," a broker said. There is "not much demand in either the wheat or the corn markets," he said.
Minneapolis Grain Exchange
MGE March wheat closed near its session low of US$6.43. The contract's session high was US$6.71 1/2.
There was a lack of fresh news for wheat, traders said. Weekly U.S. wheat export inspections of 3.547 million bushels were below trade estimates of 7 million to 14 million.
"If you take a look at the export inspections, they were pretty poor," Wagner said. "There's nothing to cheer about in that particular sector."
In other news, Pakistan said it will receive 250,000 metric tonnes of wheat from the U.S. by March, a CBOT broker said. Earlier this month, the U.S. signed an agreement to donate 50,000 tonnes of soft white wheat to Pakistan, with the U.S. government bearing transportation costs.