US wheat futures settled higher on Friday on technical buying and spillover strength from the corn and crude oil markets, shrugging off bearish wheat data in a monthly US government crop report, traders said.
USDA in its July supply/demand report raised its estimate of 2008/09 world wheat production to a record 664.24 million tonnes, up 1.3 million, with increases for both the European Union and Australia.
USDA also raised its estimate of the 2008/09 US all-wheat crop to 2.461 billion bushels, slightly below the average trade estimate of 2.471 billion, but up from 2.432 billion bushels in June. Trade was choppy, with wheat futures turning lower at midsession, led by a dip in corn and soyabeans. But CBOT wheat, corn and soyabeans all closed higher.
Grains were buoyed by a new record high in crude oil and higher gold futures, coupled with a weaker dollar. At the Chicago Board of Trade, most-active September soft red winter wheat settled up 12-3/4 cents at $8.30-3/4 per bushel. Spot July, which expires next week, ended up 12-1/2 cents at $8.19.
Commodity funds were net buyers of 2,000 CBOT wheat contracts, traders said. At the Kansas City Board of Trade, September hard red winter wheat settled up 16 cents at $8.64-1/2 per bushel. Front-month July ended up 15 cents at $8.53. At the Minneapolis Grain Exchange, September spring wheat closed up 14-3/4 cents at $8.96-1/2. Spot July ended unchanged at $9.81.
CBOT wheat volume was estimated at 53,646 futures and 12,022 options. KCBT futures volume was estimated at 13,796 contracts. MGE futures volume was estimated at 3,333 lots.