CBOT wheat futures firmer, buy-stops hit

Chicago Board of Trade soft red winter wheat futures closed firm on Monday, boosted mid-morning by a rally in Minneapolis wheat, traders said.
CBOT wheat inched higher until buy-stops were triggered and funds began covering their short positions. By the close, Chicago had gained on Minneapolis, with funds buying roughly 3,000 CBOT wheat futures.
The Chicago wheat market settled 1 to 5-1/2 cents per bushel higher in the nearby contracts, with September up 5-1/2 at $3.28-1/2 and December 2-3/4 higher at $3.36-1/4. Thinly traded December 2005 was the only month to close lower, down 1/2 at $3.59.
Minneapolis wheat futures gained on Chicago and Kansas City for most of the session on ongoing worries about the US and Canadian spring wheat crop. Cool, wet weather was slowing crop development and harvest.
But profit taking surfaced once MGE wheat hit a two-month high, sending prices lower. From Thursday's close to Monday's high of $3.93-3/4, MGE December wheat climbed nearly 30 cents a bushel.
Wheat/corn spreading and light commercial buying also supported CBOT wheat. The market opened lower amid concerns that last week's bounce in US futures prices could be slowing export demand.
Over the weekend, Egypt cancelled its snap tender for 50,000 to 60,000 tonnes of wheat due to high prices. Also bearish were lingering reminders of this year's big jump in world wheat production.
USDA on Friday forecast 2004 global wheat production at a record 610.6 million tonnes. Hungary said on Monday it had the biggest wheat crop in 10 years, providing more competition for the United States.
That sentiment was highlighted on Monday after Jordan bought 50,000 tonnes of wheat from Hungary. USDA reported on Monday that 22.477 million bushels of wheat were inspected for export last week.
That was below trade estimates for 30.0 million to 35.0 million bushels. Cash basis bids for SRW in the Midwest were steady to weak on Monday, with continued worries about poor-quality wheat, particularly due to vomitoxin.
There were nil delivery notices posted on Monday against the September contract. CFTC reported on Friday that large speculators increased their net short stance in CBOT wheat futures in the week ended September 7.
For futures, funds were long 39,419 contracts, up 2,016 from the prior week, and short 61,747, up 3,222. For futures and options combined, funds were long 36,218 contracts, up 1,205, and short 60,196, up 3,313.