Spring wheat futures on the Minneapolis Grain Exchange closed sharply higher on Tuesday, soaring to fresh all-time highs near the close on a drawdown in Canadian stocks and concerns about Australia's wheat crop, traders said.
The benchmark December spring wheat contract settled 29 cents per bushel higher at $8.27 per bushel, after rising the daily maximum of 30 cents to a top of $8.28. March closed up 27 cents at $8.29-1/2 after reaching $8.30, a record high for any Minneapolis wheat contract. Spot September, which expires on Friday, closed up 28 cents at $8.29. There were 48 deliveries on the September contract for Tuesday, with Fimat USA customers issuing all and ADM Investor Services customers stopping the wheat.
Trading volume was estimated by the exchange at 8,638 contracts and 1,135 cash exchanges. Both the Minneapolis and Kansas City wheat markets gained ground against Chicago Board of Trade wheat in the day on inter-market spreads. But all three US markets soared to their daily price limits toward the close on technical buying and commercial and speculative short covering.
Wheat futures drew strength from news that Statistics Canada reported the country's wheat stocks as of July 31 at 6.828 million tonnes, down 29 percent from a year ago and below trade estimates for 7 million to 8.6 million.
Concerns about Australia's wheat crop added support, keeping sellers on the sidelines. The head of the Grains Council of Australia said the crop is forecast to shrink to 15 million tonnes or less, well below USA's August estimate of 23 million.
USDA was scheduled to update its US and world wheat supply/demand estimates at 7:30 am CDT (1230 GMT) on Wednesday, with the trade anticipating a drop in US and world wheat ending stocks. In export news, Egypt's Holding Company for Food Industries tendered to buy optional-origin-milling wheat. And Japan said it would buy 155,000 tonnes of Canadian Australian and US wheat at its weekly tender on Thursday.
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