March wheat traded 4 1/4 cents lower late in the overnight session. Outside market forces look mixed with a firm dollar and weaker metal markets. The outlook for increased supply for the new crop season plus higher than expected supply from key exporters plus moderating weather in Europe are all seen as negative short-term forces. Australia officials raised their wheat production estimate to a new record high 29.5 million tonnes. The USDA estimate last week was 28.3 million tonnes. March wheat closed sharply higher on the session yesterday as fund buyers were active late in the day to push the market up to new highs into the close. The market stayed inside of Friday's range. A milder forecast for temperatures in Europe and a continued outlook for rising ending stocks in the US by the USDA Baseline report helped limit the advance yesterday. The weaker US dollar, a jump in equity prices and news that Egypt bought US wheat for the first time since June helped to support the market. Libya tendered to buy 63,000 tonnes of milling wheat. Weekly export inspections came in at 16.5 million bushels which was at the low end of trade expectations. Export shipments need to average just 16.5 million bushels per week for the rest of the 2011/12 season to reach the projection. Shipments have reached 72.7% of the USDA forecast for the season as compared with 70.5% as the 5-year average for this time of the year. News that the US received at least some of the Egypt tender business over the weekend helped to support. Egypt announced a tender after the close Friday and on Saturday bought 55,000 tonnes of US soft red winter, 300,000 tonnes from France and 240,000 tonnes of wheat from Argentina. The USDA baseline outlook for the 2012 season shows total planted area at 56.5 million acres from 54.4 million this season. Ending stocks for the 2012/13 season would come in at 887 million bushels as compared with 845 million for this season. This is not surveyed data but just the initial best-guess estimates from the USDA put together in November as part of the budget process. Texas reported that the winter wheat crop was rated 40% poor to very poor this week from 43% last week.
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