US wheat futures closed lower on Thursday in a profit-taking setback to Wednesday's limit rally, traders said. Seasonal harvest pressure and expectations of a large world wheat crop added pressure. Also bearish were early weakness in crude oil and gold, although crude rallied late.
CBOT corn hit new highs for a sixth straight day on flooding in the US Corn Belt, but eased off its highs by the close - sparking a sell-off in wheat. At the Chicago Board of Trade, July soft red winter wheat settled 18 cents lower at $8.51 per bushel, with back months down 17 to 22 cents.
Funds net sold 2,000 CBOT wheat contracts, traders said. Volume heavy at an estimated 169,256 futures, boosted by spreading as index funds continue to roll longs forward. At the Kansas City Board of Trade, July hard red winter wheat fell 14-1/4 cents to settle at $8.92-1/4 per bushel, with back months down 13 to 20-3/4 cents. KCBT volume was estimated at 27,297 contracts. At the Minneapolis Grain Exchange, July spring wheat ended 20 cents lower at $10.26 per bushel, with new-crop September down 17 cents at $9.44. MGE volume was estimated at 4,796 contracts.
Daily trading limit at CBOT, KCBT and MGE widened to 90 cents for Thursday. The limit reverts to 60 cents on Friday for CBOT and KCBT, but MGE stays at 90 cents. Storms raked the Plains HRW belt on Wednesday with strong winds and hail that likely caused scattered crop damage, traders said. Rains disrupted the HRW harvest in Oklahoma and the southern fringe of Kansas.
After the close, Egypt tendered to buy 55,000 to 60,000 tonnes of optional-origin wheat for shipment July 11-31. Tender results were expected on Friday. French analyst Strategie Grains ups 2008 grain forecasts on weather. USDA reported export sales of US 2008/09 wheat in the latest week at 335,100 tonnes, above estimates for 150,000 to 250,000 tonnes.
A total 1,423,600 tonnes was carried over from the 2007/08 marketing year that ended on May 31. Japan bought 177,000 tonnes of US, Australian and Canadian wheat at its weekly tender.
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