Soft red winter wheat futures at the Chicago Board of Trade closed mixed on Wednesday, with nearby July buoyed on spreads amid weather worries and supportive export news, traders said.
But trading was choppy and the market, which had been strong in all contracts early in the session, broke to the day's lows in late dealings.
CBOT wheat closed 1 cent higher to 2 cents lower, with July up 1 at $3.52.
Rand Financial spread 500 July/September, pit sources said.
Estimated volume was 33,333 futures and 3,186 options.
Egypt overnight bought 60,000 tonnes of US wheat, South Korea flour millers were seeking US wheat, and Tunisia was seeking soft wheat, all bullish for futures, traders said.
And early Wednesday, the chairman of the Iraqi Grain Board said it was issuing a tender for next month to buy 100,000 tonnes of hard wheat. Mohommad Nezer said Iraq would need to buy 2.5 million tonnes of hard wheat per year to meet its domestic needs.
Traders said wet weather this week could further damage the US soft red winter wheat crop and reduce production. Disease and the potential for head sprouting, both the result of wet conditions, are threatening the crop, which is ready for harvest.
Wet weather in the US Plains also is threatening the harvest of the hard red winter wheat crop.
Forecasts for continued rains are beginning to cause serious worries among crop watchers, a private forecaster said on Wednesday.
"The shift in weather is unexplainable and it's getting some comparison to 1993," Meteorlogix forecaster Mike Palmerino said.
In the summer of 1993, persistent rainfall in the Midwest caused massive flooding and widespread crop losses. No one is saying that will happen this year, but the current pattern is similar, Palmerino said.
Traders also noted that the wheat market was technically oversold and due for an upward correction. The nine-day relative strength index for July on Tuesday fell to 31, near the benchmark 30 level chartists view as an oversold mark.
Cash basis values in the Midwest were steady and country selling was light.
Comments
Comments are closed.