CBOT wheat futures sharply lower

Wheat futures at the Chicago Board of Trade closed sharply lower on Friday on spillover selling from falling corn and soy, traders said.
Long liquidation by commodity funds drove CBOT July soy to a 50-cent-per-bushel limit close, corn broke to a three-month low and wheat did an abrupt about-face from its higher open which had been inspired by fresh weather worries.
CBOT wheat closed 2-1/2 to 10-3/4 cents per bushel lower, with May expiring 8-1/4 lower at $3.54. New-crop July was down 10-3/4 at $3.58-1/2.
Traders said the falling soy and corn markets, amid nearly ideal crop weather for each, overrode early bullish ideas that were stemming from concerns about a cold snap early Friday in parts of the US winter wheat belt.
The cold weather, centred in the Plains States, may have harmed some of the crop because it is in its key heading and flowering stage of development.
And despite some recent rainfall, there are persistent concerns about expanding dryness in parts of the far western growing region of the Plains HRW crop.
The cold weather early Friday probably harmed some of the wheat crop in the US western Plains, especially in top hard red winter wheat producer Kansas, a private forecaster said on Friday.
"Certainly the temperatures could have damaged wheat, especially the Kansas crop," said Meteorlogix forecaster Mike Palmerino.
Palmerino said temperatures fell to the 32-degree Fahrenheit freeze mark and below over a widespread area of western and northern Kansas. The frigid weather swept through the state as the HRW crop was entering its vulnerable heading and flowering stages of development.
Light deliveries on the May contract and strong commercial stopping of wheat also gave the market some support. There were only 9 lots posted Friday for delivery and a Tenco customer, likely a commercial, stopped all of the wheat. Registrations of wheat with the CBOT late on Thursday totalled 2,366 lots, unchanged from late Wednesday.
Exports were quiet overnight and recent reports of improved crop prospects in China and Europe also were tending to stifle rallies.
Technical support in the July contract at $3.65-1/2 was broken, driving the contract to a session low of $3.56-3/4. Resistance was at $3.73-1/2. The nine-day relative strength index for July stood at 18 prior to the open on Friday. Chartists view an RSI of 30 or less as an oversold market.
CBOT wheat estimated volume on Friday was 39,716 contracts, compared with Thursday's volume of 30,196 lots. Options trade totalled 10,847 lots.