US wheat futures ease

US wheat futures eased nearly 2 percent on Tuesday in a technical setback after the market surged on Monday to a three-week high. "There is a little technical setback and there is a drier bias in Argentina's wheat harvest areas," said Terry Reilly, analyst for Citigroup.
Wheat soared 5 percent in the previous trading session on fund buying and wet weather in Argentina, which some analysts said was threatening to harm the wheat crop that is ripe and ready for harvest. US wheat for March delivery was down 9-3/4 cents per bushel at $5.41. Analysts were wary of the strength in the wheat market during Monday's big rally because of large supplies of the grain across the world.
Soy rose over a half percent on Tuesday to a one-week high as demand remained strong and as traders were hesitant to sell soy ahead of the new year and anticipated fund buying in early January. "I think part of this is seasonal strength from December into January and they (traders) are looking for possible fund money coming into the market early in 2010," said Anne Frick, oilseeds analyst for Prudential Bache Commodities.
"The soy usage is still very strong." Some support to the soy complex, especially soymeal, came from a cold snap in the US that was increasing livestock consumption of soymeal and corn, two staples in US livestock feeding rations.
"The cold weather is still influencing livestock consumption, they'll consume more in this kind of weather," said Jason Roose, an analyst for US Commodities, Des Moines, Iowa. However, Roose said much of the strength in beans was technical in nature.
"We had fallen 80 cents per bushel so it was oversold technically and we retraced about 50 percent of that Monday and Tuesday," he said. Corn held firm on spillover support from rallying soy and support from a blanket of snow in the US that is covering around 500 million to 600 million bushels of unharvested corn. Fund buying the previous day boosted corn to a six-month peak and soy 3 percent to a one-week high. CBOT settlement prices.