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Wheat sinks on high delivery numbers

11/30/2012 @ 3:18pm

U.S. wheat futures dropped Friday, pressured by higher-than-expected deliveries of wheat against futures at the Chicago Board of Trade.

CBOT December wheat settled down 24 1/2 cents, or 2.8%, at $8.44 3/4 a bushel. KCBT December wheat fell 19 3/4 cents, or 2.2%, to $8.97 1/2 a bushel. MGEX December wheat fell 12 3/4 cents, or 1.4%, to $9.18 1/2 a bushel.

There were 2,119 wheat contracts delivered against CBOT December wheat as of Friday, which was first-notice day for December futures, according to exchange operator CME Group Inc.

Traders had expected wheat deliveries in a range of 100 contracts to 200 contracts. The greater-than-expected deliveries suggest physical supplies may not be as tight as analysts had feared. That weighed on futures prices.



"I think that the losses are because the deliveries were heavier than expected" and because wheat export demand has been "disappointing," said Dan Cekander, director of grain market analysis at brokerage NewEdge USA LLC.

A weekly U.S. Department of Agriculture report on Thursday showed recent wheat export sales were smaller than analysts had expected, renewing concerns about weak exports.

Wheat futures slightly extended their losses Friday, after CME Group said that on Thursday it reported an incorrect number of CBOT wheat contracts available for delivery--a different figure from the actual deliveries that the company also reported.

CME Group said it will compensate market participants who suffered losses because of the error. The company said it issued an incorrect report on Thursday, after 4 p.m. CST, showing 164 wheat shipping certificates registered. That number did not include 2,000 other registered certificates, and the company corrected the report on its website at 5:46 p.m. CST, it said.

Corn futures fell moderately on Friday, pulled lower by the declines in wheat and technical trading. Deliveries of 246 contracts against CBOT December corn were also greater than traders had expected, leading to pressure on futures.

December corn futures fell 3 1/2 cents, or 0.5%, to $7.48 a bushel.

Soybean futures fell on profit taking ahead of the weekend and the end of the month, after prices rose over the last two weeks. Lower wheat prices also pressured soybeans.

January soybean futures fell 9 1/4 cents, or 0.6%, to $14.38 3/4 a bushel.


Write to Owen Fletcher at owen.fletcher@dowjones.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires
(END) Dow Jones Newswires
November 30, 2012 15:38 ET (20:38 GMT)
DJ U.S. GRAIN AND SOY REVIEW: Wheat Falls on High Deliveries->copyright


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