US wheat futures closed lower in light volume Monday, pressured by the continuing US harvest, expectations of a record large world crop and spillover weakness from corn and soybeans, traders said. "It was a weak trade. The bottom line is we've got plenty of wheat around," one Chicago wheat trader said.
At the Chicago Board of Trade, most-active September soft red winter wheat settled 12-3/4 cents lower at $8.18 per bushel. Front-month July expired quietly at $8.10, down 9 cents on the day. Commodity funds were net sellers of 3,000 CBOT wheat contracts, traders said.
At the Kansas City Board of Trade, September hard red winter wheat fell 13-1/2 cents to settle at $8.51 a bushel. Front-month July expired at $8.45, down 8 cents on the day. At the Minneapolis Grain Exchange, September spring wheat settled at $8.79-1/2 a bushel, down 17 cents. Spot July expired at $9.81, unchanged on the day.
MGE began settling its spring wheat futures contracts through a weighted average of prices from both its open-outcry and electronic trading platforms. CBOT wheat volume was thin at an estimated 37,430 futures and 9,948 options. KCBT futures volume estimated at 9,007 contracts. MGE futures volume estimated at 3,433 contracts.
Market still absorbing bearish data in USDA's July 11 reports, in which USDA upped its 2008/09 world wheat production estimate to a record 664.24 million tonnes. Some rain-related disruptions to the remaining winter wheat harvest in the US Plains, but nothing major. Rainfall favours summer crops.
Export inspections data was disappointing for wheat, corn and soybeans. USDA said 11.929 million bushels of US wheat were inspected for export last week, below trade estimates for 17 million to 23 million. Market unresponsive to news that Iraq's Grain Board was close to buying 300,000 tonnes of US hard red winter wheat in first major deal in nearly two months.
After the close, Egypt issued a snap tender for 55,000 to 60,000 tonnes of optional-origin wheat for shipment August 10-20. Tender results were expected Tuesday. USDA said in its weekly crop progress report late Monday that the US winter wheat crop was 62 percent harvested as of Sunday, behind the five-year average of 70 percent.
USDA also said US spring wheat ratings deteriorated, with 61 percent rated good/excellent, down from 69 percent a week earlier. A USDA attache report estimated Australia's 2008/09 wheat crop at 22.4 million tonnes, below USDA's official July 11 forecast of 25 million.
Rains in parts of Argentina allowed farmers to catch up with seeding wheat last week, but dry conditions caused delays elsewhere, the Buenos Aires Grains Exchange said.South Korea buys US wheat. The supplement to CFTC's weekly reports showed large speculators stretched their net short in CBOT wheat to 33,979 contracts as of July 8, up 14,000 lots.