spring wheat futures at the Minneapolis Grain Exchange closed mostly higher on Thursday on slipover strength from Chicago Board of Trade wheat and corn, traders said. But prices came off session highs as speculators took profits, traders said. Concerns about export prospects for US wheat also weighed on values.
MGE December spring wheat closed up 4 cents at $5.03-1/2 per bushel after reaching $5.16. March ended down 1-1/2 cents at $5.15-3/4. The December/March spread last traded at a carry of 14 cents after trading at 13-1/2 to 15. Volume was estimated by the exchange at 7,164 contracts, up from 5,080 lots on Wednesday.
ADM Investor Services net sold 300 March contracts while UBS bought 200 March. Country Hedging spread 700 December/March, traders said. As futures climbed, concerns about waning export demand for US wheat hung over the market. Notably, regular buyer Japan on Thursday cancelled a planned purchase of 40,000 tonnes of US wheat and 20,000 tonnes from Australia due to high prices.
Also, trade sources in Beijing said China likely would continue exporting feed wheat. "We're starting to see the fundamental concerns about what this price level is doing to demand," Prudential Financial grains analyst Shawn McCambridge said.
"The concern is that we've done too good a job of price rationing, and maybe the current price level is too high." The US Department of Agriculture reported export sales of US wheat last week at 938,800 tonnes, a marketing year high that was also above trade estimates for 450,000 to 650,000 tonnes. However, a sale of 400,000 tonnes of wheat to Iraq, which was announced last week, made up nearly half the total.
Private forecaster Meteorlogix predicted the US Plains winter wheat belt should stay mostly dry through the weekend, but storms on Monday to Wednesday should produce 0.3 to 1.5 inches of beneficial rain in southern Oklahoma and Texas.