US Wheat Review on Tuesday: Slips more on ample world supply, harvest

 

 

Bearishness about ample world supplies and the advancing U.S. harvest pushed down U.S. wheat futures Tuesday, with Chicago Board of Trade wheat closing lower for the fifth consecutive day.

 

Chicago Board of Trade September wheat fell 9 1/4 cents to US$5.94 1/4 a bushel. Kansas City Board of Trade September wheat stumbled 8 1/4 cents to US$6.34, and Minneapolis Grain Exchange September wheat sank 10 3/4 cents to US$7.06.

 

Nearby CBOT July wheat in open outcry trading hit a fresh six-week low of US$5.65 1/2, its lowest price since May 7. The contract closed down 9 1/2 cents at US$5.65 3/4. Commodity funds sold an estimated 3,000 contracts.

 

CBOT wheat has weakened daily since the U.S. Department of Agriculture on Wednesday raised its forecasts for new-crop ending stocks. There are feelings that there is more than enough wheat to go around, said Dave Marshall, an independent marketing adviser and commodities broker.

 

There continue to be worries about yield and quality losses in soft red winter wheat due to fungal diseases, such as head scab. Scab has been reported in Illinois, which saw an "especially severe" decline in weekly crop ratings, Marshall said. The USDA rated 48% of the state's crop good to excellent as of Sunday, down from 60% a week earlier.

 

"Just copious amounts of rainfall the last two months have tended to make producers very concerned about what yield and quality of this crop are going to be like when we finally get into it," Marshall said.

 

 

Kansas City Board of Trade

 

KCBT wheat led the break in wheat after the markets rose at the opening, an analyst said. Weakness in the U.S. dollar offered the markets early support, but expectations for harvest advances pressured prices, he said.

 

The U.S. winter wheat harvest was 9% complete as of Sunday, down from the average of 19%, according to USDA. Cutting was 37% complete in Texas, down from the average of 45%, and 22% complete in Oklahoma, down from the average of 61%.

 

 

Minneapolis Grain Exchange

 

MGE wheat led the downside amid pressure from losses in the other wheat markets, traders said. There continue to be concerns about delayed development of spring wheat following late planting, although crop condition ratings are improving.

 

The USDA said that 75% of the spring wheat crop was good to excellent, up from 72% last week and 67% at the same time last year. North Dakota's good-to-excellent rating climbed to 83% from 78% the prior week, and South Dakota's rating jumped to 62% from 56%.