September wheat was down 6 cents late in the overnight session. Outside market factors look mixed today but somewhat supportive if the dollar stays weak. The market is once again trading near the low end of the 1-month consolidation after giving back much of the gains from the surge higher on Tuesday. With fund traders holding a net short position in the recent COT reports, the long liquidation selling pressures may be limited. Iraq bought 50,000 tonnes of wheat from Russia overnight, and Egypt bought 240,000 tonnes of wheat from Russia and Romania in their tender yesterday, none from the US. While Russia continues to attract the business, their selling prices are inching higher. September wheat closed sharply lower on the session yesterday but stayed inside of the range from Tuesday. The market had found some support this week from talk of lower than expected yields for the spring wheat crop, but bearish outside market forces and weakness in the other grains emerged as negative forces. The surge higher in the US dollar and the very weak action in other commodity markets helped to drag wheat prices sharply lower on the day. US wheat is already having a tough time competing with Russian wheat for the world export market, so the stronger US dollar only added to those concerns. Net weekly export sales for wheat, released before the open yesterday, came in at 499,600 metric tonnes for the current marketing year and 4,500 for the next marketing year for a total of 504,100, which was slightly higher than trade expectations. As of July 28th, cumulative wheat sales stood at 33.7% of the USDA forecast for 2011/12 (current) marketing year versus a 5 year average of 32.8%. Sales of 470,000 metric tonnes are needed each week to reach the USDA forecast. The European Union granted export licenses for wheat this week for 157,000 tonnes, which pushed cumulative exports to 1.1 million tonnes from 1.2 million last year at this time.
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