Chicago Board of Trade wheat futures were mixed in choppy low-volume trading early on Friday as the market prepared for the release early Monday of USDA's January crop reports, traders said.
"I don't think they want to do much before Monday, just a little positioning," a pit source said.
At 10:01 am CST (1601 GMT), CBOT wheat was up 1 to down 3-1/2 cents per bushel, with March up 1 at $3.95.
SAK Futures bought 300 March, Man Financial sold 100 March, Prudential Securities sold 200 March and Refco Inc bought and sold 300 March.
Position-squaring was the main feature ahead of the release Monday of USDA's January crop production reports, which will include the USDA's first look at US winter wheat seedings for harvest in 2004.
An average of analysts' estimates pegged seedings at 45.637 million acres, slightly above last year's seedings of 44.945 million. Analysts' also pegged US 2003/04 wheat ending stocks next June at 555 million bushels, below USDA's forecast in December for 583 million.
USDA recently has been active in switching export sales of wheat from its unknown destination category to China, and an outright sale of US new-crop wheat to China would be welcomed by wheat bulls, the traders said.
Dry soils and lack of snow cover in the western and southern US Great Plains were keeping fears of winter-kill damage in the market. Dry weather will keep stressing parts of the hard red winter wheat crop, a private forecaster said Friday.
Technical support in the December contract was at $3.93 per bushel, the session low and resistance was at $3.97-1/4.
The nine-day relative strength index for December stood at 59 before the open on Friday. Technical traders view a reading 70 or more as an overbought market and 30 or less as an oversold market.