Wheat leads grains lower Wednesday
U.S. wheat futures stayed lower as trading ended Wednesday, pressured by technical selling and expectations for wheat supplies to be adequate.
Chicago Board of Trade July wheat futures settled down 17 cents, or 2.4%, at $6.93 3/4 a bushel, a two-week closing low for the contract.
KCBT July wheat fell 15 1/4 cents, or 2.0%, to $7.51 3/4 a bushel. MGEX July wheat fell 7 1/2 cents, or 0.9%, to $8.03 3/4 a bushel.
Freeze damage and persistent drought conditions have threatened winter wheat crops in the southern Plains this spring, but many market participants still expect supplies to be adequate. The U.S. Department of Agriculture last week forecast greater-than-expected domestic wheat stockpiles about one year from now, at the end of the 2013-14 crop year.
Meanwhile, world wheat production is expected to rebound this year due to increases in areas including the former Soviet Union.
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"We're getting close enough to harvest that the trade is convinced that we're going to have adequate supplies domestically and globally," said Arlan Suderman, a senior market analyst with Water Street Solutions in Wichita, Kan. "I think it's just seasonality."
U.S. farmers will begin harvesting their winter wheat crops around early June.
Selling in wheat futures picked up Wednesday when CBOT July wheat fell below its trading range of recent days, which technical traders took as a signal that further declines were likely.
Wheat also was pressured by a stronger dollar, which makes U.S. wheat exports more expensive for foreign buyers. Wheat is more susceptible than corn or soybeans to pressure from a strong dollar because U.S. wheat exports face greater competition from other large wheat-exporting countries.
Despite the decline in wheat, this week's hot weather in the Plains "is the last thing that we need for the hard red winter wheat crop," Mr. Suderman said. The heat could push the crop closer to maturity before it has had time to fully develop its grain, he said.
Corn futures fell Wednesday on expectations for this week's warmer, drier weather to allow for a substantial pickup in corn planting in the Midwest, easing worries about planting delays for the new crop.
Soybeans fell on lower-than-expected data on the amount of soybeans "crushed," or processed, in April in the U.S. Both corn and soybeans also fell as commodity markets generally declined Wednesday.
July corn fell 1 3/4 cents, or 0.3%, to $6.50 3/4 a bushel.
July soybeans fell 2 cents, or 0.1%, to $14.12 3/4 a bushel.
Write to Owen Fletcher at email@example.com
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(END) Dow Jones Newswires
May 15, 2013 15:24 ET (19:24 GMT)
DJ UPDATE: U.S. Wheat Falls on Technical Selling, Adequate Supply->copyright
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