MGE wheat up as funds keep buying commodities

Spring wheat futures at the Minneapolis Grain Exchange closed higher on Thursday as investment funds keep buying commodities including gold, crude oil and wheat, traders said.
"Definitely people are looking at the outside markets before they step into the pit each morning. They're watching closely the index funds and other investment funds," a trader said. New York COMEX June gold futures surged $20 per ounce to roughly a quarter-century high and crude oil markets jumped more than $1.00 per barrel.
The inflationary implications of surging commodity markets, including wheat, kept aggressive selling interest away from MGE wheat. MGE wheat closed unchanged to 6-3/4 cents per bushel higher, with July up 6-3/4 at $4.50-1/4 per bushel.
ADM Investor Services, Refco Inc and UBS Warburg were buying Minneapolis Grain Exchange wheat and FC Stone was a noted seller of 200 July, traders said.
Spreading also contributed to the advances with Minneapolis Grain Exchange traders buying MGE spring wheat and selling the winter contracts traded in Chicago and Kansas City.
Support also stemmed from cold weather early Thursday in northern parts of the United States Plains hard red winter wheat region that may have harmed some of the flowering wheat plants and given an extra boost to KCBT hard red winter wheat futures.
Weekly export sales data was bullish.
The USDA said export sales of US wheat last week totalled 413,800 tonnes (old and new crop combined), above estimates for 200,000 to 350,000 tonnes. However, the old-crop total of 33,100 tonnes was a marketing-year low.
Japan bought 90,000 tonnes of wheat from the United States and Canada at its weekly tender. US FOB offers for HRW wheat firmed on optimism about sales to Iraq.
Positioning was expected ahead of Friday's USDA May supply/demand reports.
The average analyst estimate for US 2006 winter wheat production was 1.373 billion bushels, down from 1.499 billion last year.
Analysts pegged old-crop United StatesZ wheat ending stocks at 537 million bushels and new-crop stocks at 466 million.