March 4, 2006
US Wheat Review on Friday: Higher on weather concerns, kansas city board of trade strength
U.S. wheat futures ended modestly higher Friday, making new highs late in the session as firm prices in Kansas City hard red wheat futures, light fund buying and weather concerns over the potential for moisture in the U.S. Central Plains the next several days provided support for futures, sources said.
Trading volume was relatively modest, sources added.
The strength in KCBT wheat spilled over into Chicago wheat, said Vic Lespinasse of AG Edwards & Sons.
The funds were light buyers of wheat and the forecast is for some precipitation for the U.S. Central Plains, but there is some doubt about the amount the driest areas will receive, he said.
DTN Meteorlogix weather forecast a chance for light showers in the Central and Southern Plains on Saturday, with amounts expected a trace to .25 inch and locally heavier in the central and eastern areas of the region. There is a chance for scattered showers in the region Tuesday and Wednesday. Rainfall should average a trace to .25 inch in the west and .10-.75 inch and locally heavier in the east. Temperatures are predicted to average near to above normal, DTN Meteorlogix said.
Until the rain forecast for the hard red wheat belt materializes, the market should trade sideways to higher, a commission house analyst said. There is just not a lot of interest in selling it right now, he added.
CBOT March wheat rose 4 1/2 cents to US$3.73 1/2 per bushel. May wheat settled 4 1/2 cents higher to US$3.85, and July ended 4 1/4 cents higher to US$3.96.
In CBOT trades, ABN Amro bought 200 May, JP Morgan bought 500 May, Fimat bought 1,500 May, Man Financial bought 200 May, Rosenthal bought 400 July and UBS bought 300 May.
O'Connor sold 1,500 May, Fimat sold 100 May, and Refco sold 100 May.
Commodity fund buying was estimated at 1,500 contracts.
Kansas City Board of Trade
KCBT wheat futures finished higher as moisture concerns in the U.S. Central Plains this weekend provided support for prices, floor sources said. There are concerns that the system expected to bring some rain in over the weekend is dissipating and there was "absolutely noting for sale today," a KCBT floor trader said.
On technical charts, May settled above its 10-day moving average for the first time since Tuesday.
March gained 6 1/2 cents to US$4.43 per bushel with May ending up 5 3/4 cents to US$4.45 1/2. July settled 5 1/2 cents higher at US$4.48 1/2.
In KCBT trades, Man Financial bought 300 May, ABN Amro bought 300 May, and the Refco division of Man Financial bought 600 July.
Man Financial sold 300 May and Prudential Financial sold 400 December.
Minneapolis Grain Exchange
Spring wheat futures ended mostly higher as futures followed the tonnee set in Kansas City an MGE floor trader said. It was a quiet trade with no one willing to sell it ahead of the weekend, he added.
MGE March wheat slipped 2 cents to US$4.21, with May finishing 3 1/4 cents higher at US$4.28 3/4.
Minneapolis grain receipts totaled 52 cars of wheat and 54 of durum versus 204 cars of wheat and 61 train cars of durum a year ago.
Friday afternoon, the Commodity Futures Trading Commission will release the latest commitment of trader's data as of Feb. 28.
On Monday, U.S. Department of Agriculture is scheduled to release the weekly export inspections at 10:00 a.m. CST.