March wheat was up 13 3/4 cents late in the overnight session. The US dollar is slightly higher overnight. A combination of a potential peaceful transition of power in Egypt plus weather concerns supported the strong gains in wheat overnight. March wheat gave back some of Monday's strong gains yesterday with a slightly lower close. New crop futures gave back less, as the market found some support from fears of potential winterkill damage on winter wheat fields which might not get enough snow cover ahead of the cold weather that is on its way. Some concerns have developed for the unshipped wheat to Egypt, as traders are still waiting to see if they can get communications, employees and security issues resolved to reopen any other ports besides the Suez canal. This helped spark some long liquidation (profit-taking) selling yesterday. The trend toward less violence is seen as a positive factor and a step in the right direction, as traders believe that if there is a peaceful transition of power than the new government is likely to be interested in increasing its imports of food. Saudi Arabia plans to import 2 million tonnes this year. Active exports and tenders to North Africa and the Middle Easten countries along with some weather concerns plus the sharp drop in the US dollar helped to provide some underlying support yesterday. Jordan is tendering to buy 100,000 tonnes of wheat. Iraq is also tendering for 100,000 tonnes, and Lebanon is tendering to buy 22,500 tonnes of milling wheat. Bangladesh is in the market for 50,000 tonnes of wheat and 30,000 tonnes of rice. Reports of potential increases in exports from Pakistan and maybe Russia if weather is good this year appeared to limit the advance yesterday. As of the end of January, Kansas winter wheat crops rated good to excellent came in at just 27%. This compares with 56% last year and 49.7% as the 5-year average. Poor to very poor ratings were 37%. Crops rated good to excellent in Texas were just 17% with the crop index at 43 vs. 58 last year. In Oklahoma, only 21% of the crop is rated good to excellent and 40% poor to very poor. Topsoil moisture is rated 55% very short and 33% short. In Nebraska, 41% of the winter wheat crop is rated good to excellent.
Join the Discussion