May wheat was trading 8 3/4 cents higher late in the overnight session. Outside market forces look mixed as a strong US dollar clashes with a strong US stock market. Ideas that the market is oversold plus short-covering from fund traders helped to support the bounce overnight. Funds hold a huge net short position coming into the week but with improving crop conditions and weakness in the other grains, the market has seen increased selling pressures so far this week. However, the turn up in the other grains leaves wheat vulnerable to a bounce. July KC wheat is already down as much as 77 1/4 cents off of the April highs as the market was pricing in a large crop ahead. July Chicago wheat closed 4 1/2 cents lower on the session yesterday but up 6 1/2 cents from the lows. Improving crop conditions, a fast start to the spring wheat plantings and a lack of threatening weather were factors to help pressure the market early. However, a lack of new significant selling interest on the move to the lowest level since December 19th, talk that US wheat is competitive on the world market and talk of the cheap price of wheat relative to corn helped spark the rally to near unchanged on the day into the mid-session. Jordan bought 50,000 tonnes of wheat in a tender for 100,000. Winter Wheat is rated 64% good/excellent compared to 36% last year. Spring Wheat is 37% planted compared to 5% last year. North Dakota is 27% complete from 0% last year and Minnesota is 56% complete from 0% last year. Traders see weekly export sales, for release before the opening, near 550,000 tonnes. Japan bought 139,000 tonnes of wheat at their weekly tender from the US, Canada and Australia. Taiwan bought 41,650 tonnes of US wheat overnight.
Join the Discussion