MGE spring wheat futures close mixed

Spring wheat futures at the Minneapolis Grain Exchange closed mixed on Wednesday, with nearby months lower in sympathy with declines in the Chicago and Kansas City wheat markets, traders said. News of export demand from Tunisia provided underlying support.
Tunisia issued a tender to buy nearly 100,000 tonnes of optional origin milling wheat and 50,000 tonnes of US Dark Northern Spring wheat, European traders said. Minneapolis December springs wheat ended down 3 cents at $8.34 per bushel, with March down 1 cent at $8.39-3/4.
Back months were down 1 to up 8 cents. Volume was estimated by the exchange at 5,942 contracts. The December/March spread traded at a carry of 3-1/2 to 4 cents, roughly unchanged from Tuesday. Slipover strength from outside markets including corn, soyabeans and crude oil added support.
US crude oil futures hit a record high above $94 per barrel on a surprise drawdown in weekly crude inventory data. But wheat futures in Chicago and Kansas City were mostly lower, pressured by ideas that US wheat was overpriced.
The market had little reaction to comments from a Russian government official who threatened further grain export restrictions to contain inflation if world prices keep rising. Less than two weeks ago, rumours of potential Russian wheat export tariffs sent US wheat prices soaring.
Futures later retreated on word that Russia shelved those plans. In other news, India, the world's No 2 wheat importer, said it plans to limit its purchases this year at 2.3 million tonnes due to adequate stocks. India has already contracted to import 1.3 million tonnes of wheat in 2007 and is expected to tender soon for another 1 million tonnes.
India said it planned to import around 5 million tonnes of wheat in 2007 to build buffer stocks. At the market's close, the US Federal Reserve cut its benchmark interest rate by a quarter-percentage point, as expected.
The US dollar fell to a record low against the euro on the news, a factor that should support US commodity prices on Thursday. Traders were awaiting the USA's weekly export sales report on Thursday. Estimates of US wheat sales ranged from 650,000 to 750,000 tonnes.