US Plains hard red winter wheat basis bids were holding steady on Monday, though the market was adopting a weaker tone amid scant near-term demand and expectations for a sizeable new wheat crop, merchants said. Protein premiums dropped a penny a bushel for rail-car wheat to and through Kansas City after mill spot needs were largely met.
"The basis feels like it's starting to top over," said one cash wheat trader. "A lot of people are covered now until new crop even though there is very little wheat moving out of the country."
Weekend storms, including heavy rains, flooding, hail and tornadoes, were seen as potentially harmful to the new crop. The conditions were likely to worsen disease pressure, particularly leaf rust, wheat experts said.
Harvest of the HRW wheat crop will kick off by the end of May in some Plains states, traders said, adding that prices will come under pressure as supplies enter the market.
Consulting firm Informa Economics on Friday estimated the 2007 US winter wheat crop at 1.604 billion bushels, up from 2006 production of 1.298 billion, trade sources said. Informa put the US hard red winter wheat crop at 984 million bushels. That came after an industry-organised tour of Kansas wheat fields on Thursday estimated the state's crop at 392.7 million bushels, up from the tour's 2006 estimate of 319.2 million.
Futures prices at the Kansas City Board of Trade were called to open 1 to 2 cents higher on Monday, supported by strength in corn prices. KCBT May wheat closed up 3-1/2 cents at $4.76 per bushel on Friday, with July up 2 at $4.85 and December down 3/4 at $5.06-3/4.
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