CBOT wheat futures lower

Wheat futures on the Chicago Board of Trade closed lower on Thursday after trading both sides of unchanged, with prices dipping to contract lows in response to fund long liquidation in the Kansas City market, traders said.
"Kansas City pulled us down. They were heavy all day," one CBOT floor source said.
An increase in the European Union's wheat export subsidy was also seen as bearish, signalling that the EU was turning more aggressive in its export efforts. The EU raised the subsidy to a maximum 7 euros per tonne, up from 5 euros last week.
CBOT March wheat closed down 1 cent at $3.12-1/4 after posting a contract low at $3.09-1/2, falling through support at the previous low of $3.10. Traders noted good demand under the market, which kept prices from falling apart. Sellers emerged at the $3.14 level.
Deferred months ended down 3/4 to 3 cents. The December and May wheat contracts also closed lower after touching new lows.
Funds were even on the day, traders said.
Volume was light, estimated by the exchange at 26,677 futures and 2,786 options.
The market opened higher on a technical rebound and some short covering ahead of the US Department of Agriculture's December crop reports, which were due out on Friday morning.
Some analysts expected the USDA to trim the US wheat stockpile to reflect increased exports, including recent sales to Iraq. The average trade estimate for 2005/06 US wheat ending stocks was 523 million bushels, slightly below USDA's November forecast for 530 million.
Others expected USDA to adjust wheat stocks by class, trimming ending stocks for US hard wheat and raising the carryout for US soft wheat.
In its weekly export tally, the USDA reported sales of US wheat for last week at 451,400 tonnes, within the range of estimates for 350,000 to 500,000 tonnes. The total included 202,000 tonnes of hard red winter wheat for Iraq.
Exports overnight included Japan's purchase of 125,000 tonnes of wheat, with 45,000 tonnes from the United States. Also, South Korea was seeking 22,000 tonnes of US wheat.
Talk of potential winterkill in parts of the US Plains hard red winter wheat region failed to generate bullish momentum in the futures market.
"It's pretty cold. There might have been some damage to wheat due to the fact the crop was poorly established," Meteorlogix forecaster Joel Burgio said.
A protective blanket of snow was in place over parts of Colorado, north-west Kansas and Nebraska, but sections of central Kansas and the Texas Panhandle lacked snow cover, leaving fields vulnerable to cold and windy conditions.