March wheat traded 12 1/4 cents higher late in the overnight session. Outside market forces look mostly positive today with weakness in the US dollar and strength in metal and energy markets. Fears that Russia will eventually restrict exports plus weather concerns for any areas of the Black Sea region which are not covered with snow plus a much more positive tilt to commodity markets in general supported another strong upmove in wheat overnight to push March wheat to the highest level since January 4th. Surging open interest on the break to the January 18th lows plus news that fund traders held a record net short position as of January 17th has added to the bullish tone. March wheat surged higher in early trade yesterday following renewed fears that Russia could curb exports beginning in April plus continued talk that US wheat is competitive on the world market. This sparked another round of short-covering. However, even after the Fed committee minutes were released and the dollar fell sharply and gold pushed to the high end of a $50 range, the market chopped around in a fairly tight range to close moderately higher on the day and well off of the highs. In other words, the turn higher in outside market forces failed to attract much in the way of new support. Since the January 3rd peak, open interest is up 78,462 contracts. Traders suspect that Egypt will buy US wheat at their next tender. The winterkill threat to Russia and Ukraine comes after a disastrous planting season in the late fall. Traders already suspect a Ukraine wheat harvest for 2012 which is down about 8 million tonnes from 22.3 million last year.
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