March wheat was trading down 4 cents late in the overnight session. Outside market forces look negative today with a strong US dollar and weakness in metal markets. The market remains in a steep uptrend, but has RSI pushed above 75, and this has traders nervous over an overbought condition. Traders believe that fund traders held a near record net short position into mid-December, but the market has now closed higher for eight sessions in a row and has managed to push to the highest level since November 10th. Strength in the corn market and continued short-covering due to threatening feedgrain weather for South America has helped to support moderately higher trade. A turn down in gold, energy markets, the stock market and the euro currency yesterday failed to spark much in the way of new selling interest, and the market saw an active session of fund trader buying. Kazakhstan harvested a record grain crop in 2011 of nearly 26 million tonnes by clean weight, which was up sharply from 12.2 million last year. March wheat is up as much as 66 1/2 cents from the December 16th lows. Algeria bought 250,000-300,000 tonnes of milling wheat in a tender yesterday, and traders believe the origin will be South America. Morocco extended duty-free imports for wheat through the end of February due to a need to replenish stocks. The USDA attache in Russia indicated that the country has exported over 15 million tonnes of grain including 12.8 million tonnes of wheat for the July to November time frame. However, exports are seen as slowing significantly in the next 2-3 months as weather becomes a factor for Russia and low-priced Argentina wheat is beginning to move on the international market.
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