US Wheat Review on Friday: Lower on positioning, dollar strength

 

 

U.S. wheat futures ended lower; falling on pre-weekend positioning, with strength in the U.S. dollar supplying weakness to attract speculative selling.

 

July CBOT wheat ended 12 1/4 cents lower at US$6.23, July KCBT wheat settled 15 cents lower at US$6.75, and July MGE wheat finished 17 3/4 cents lower at US$7.43 1/2.

 

In CBOT pit trades, speculative fund selling was estimated at 4,000 lots.

 

The market experienced a round of consolidation following a volatile week of trading, with the spike in the U.S. dollar weighing on prices, said Shawn McCambridge, senior grains analyst at Prudential Bache in Chicago.

 

"The market had no clear distinct fundamental features to trade on today, leaving the market to follow the lower tonnee in corn and soybeans, with the dollar's rise generating broad based weakness in the CBOT ag complex," McCambridge said.

 

Positioning ahead of next week's winter wheat crop production and supply and demand reports added to the market's pre-weekend setback.

 

Otherwise, the market is seemingly losing some buying interest heading toward the heart of the winter wheat harvest, leaving futures at the mercy of outside market influences, said Jack Scoville, analyst at Price Futures Group.

 

Looking ahead, traders anticipate the market will experience a short period of consolidation, looking to U.S. and world economic conditions for leadership. Choppy trade could be a feature, as traders position themselves ahead of the U.S. Department of Agriculture product and supply/demand reports Wednesday, said McCambridge.

 

The DTN Meteorlogix weather forecast calls for favorable conditions in the Southern Plains wheat areas for heading and filling wheat. Mature wheat and the wheat harvest in southern areas should benefit from a period of hotter and drier weather this weekend.

 

 

KAansas City Board of Trade

 

KCBT wheat futures stumbled in step with the rest of the complex, succumbing to technical and speculative sales. The absence of fresh demand news and the heart of the hard red winter wheat harvest still ahead, traders had little fundamental features to focus on, analysts said.

 

 

Mineapolis Grain Exchange

 

MGEX wheat retreated in unison with other U.S. wheat markets, pressured by consolidative price action following a volatile week.