Spring wheat futures on the Minneapolis Grain Exchange closed higher on Tuesday in thin trade, influenced by rallies in Chicago Board of Trade grains and the energy markets, traders said.
US crude oil prices climbed $3 to near $57 a barrel, and the Reuters/Jefferies CRB Index of 19 commodity futures closed up 2.54 percent at 298.30. CBoT March wheat ended up 3 cents at $4.59-1/2 per bushel and March corn was up 4-3/4 cents at $4.04-3/4.
Minneapolis March spring wheat ended up 2-1/4 cents at $4.89-1/2 per bushel, with back months up 5 cents to down 6-3/4 cents. J.P. Morgan and ADM Investor Services were light buyers of March, May and December, Minneapolis traders said. Volume was light, estimated by the exchange at 3,700 contracts, down from 4,854 lots on Monday.
Spreading was a feature as firms continued to roll March positions forward. March/May traded at a carry of 10 cents. Cash markets were steady to firm. Grain movement was slowing in the northern US Plains, with an approaching Arctic air mass expected to produce some of the coldest temperatures of the winter starting Friday. Export business featured confirmation from USDA that exporters sold 100,000 tonnes of US HRW wheat to Iraq, but traders said the sale had already been factored into prices. However, there were signs that recent declines in futures have made US wheat more competitive on the world market.
Taiwan was set to tender Thursday for 80,000 tonnes of US wheat, and South Korean millers set a tender to buy 21,500 tonnes of US wheat on Wednesday. Japan said it would skip its regular wheat tender this week due to adequate supplies. Statistics Canada was scheduled to report Wednesday on Canadian grain stocks as of December 31. Trade estimates of all-wheat stocks ranged from 23.7 million to 24.6 million tonnes, and averaged 24.3 million tonnes. That compares with 24.128 million tonnes at December 31, 2005, reflecting larger wheat production and a glut of carry-in stocks.
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