May wheat was trading 5 1/2 cents higher late in the overnight session. Outside market forces look positive with a weaker US dollar and moderately higher trade in the US stock market. There is some concerns for cold weather damage and outside forces are strong today but neither force seems strong enough to shift the overall supply/demand outlook. Traders see the possibility of even better feeding usage than the USDA estimate yesterday which could tighten the old crop stocks situation a little further but the improving yield and production outlook for the new crop season has more and more traders expecting higher, not lower ending stocks for the 2012/13 season. Without a surge in corn values or a significant weather issue from another key world producer, the path of least resistance could stay down. Taiwan is tendering to buy 41,650 tonnes of US wheat. Libya bought 50,000 tonnes of milling wheat from Russia. Algeria bought at least 125,000 tonnes of durum wheat and Jordan is tendering to buy 100,000 tonnes of hard wheat. India reported April 1st foodgrain stocks at 53.3 million tonnes which is up more than double the buffer stock requirement. Morocco is tendering to buy 180,000 tonnes of soft wheat. Improving crop weather for the US and Europe and a fast start to the spring wheat season plus a bearish trend from outside market forces and weakness in the other grains helped to drive the market lower to close sharply lower on the day. A turn up in the soybean market helped to offset a more negative tilt to outside market forces to support a moderate bounce into the mid-session and a new 3-day high. However, a continued trend higher in the US dollar and a collapse to trade near 200 lower for the Dow helped to spark an aggressive selling trend during the second half of the session. July Kansas City wheat closed 19 1/2 cents lower to the lowest close since July of 2010. The USDA pegged US ending stocks at 793 million bushels as compared with 825 million last month due to a revision higher of 35 million for feed usage. World ending stocks came in at 206.3 million tonnes from 209.6 last month and from a record high of 213.1 million just a few months ago. China feed usage was revised higher by 2 million tonnes to help lower the stocks numbers. The weekly Winter Wheat Conditions report showed that 61% of the crop is now rated good/excellent compared to 58% last week and 36% last year.
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