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Wheat Futures Taking Back Losses Midday
Wheat futures were mixed in midday trading, taking back early losses, as investors weigh improving crop conditions in the southern Plains with the prospect that low prices will spur demand.
As much as six times the normal amount of rain has fallen in the past month in much of western Kansas and the Oklahoma and Texas panhandles. A storm moving into the High Plains out of the Rockies today may bring snowfall, which will provide a blanket for recently emerged plants.
Exporters in the week that ended October 5 sold 226,670 metric tons of wheat to overseas buyers, down 38% from the prior four-week average, and commitments to buy U.S. wheat in the current marketing year are down about 17% from the same time frame in 2014, according to the U.S. Department of Agriculture.
Still, low prices are expected by analysts to encourage overseas buyers to make purchases to fill immediate needs.
“We got some moisture on the wheat out this way, which I think will get us into dormancy,” said Larry Glenn, a grain analyst at Frontier Ag in Quinter, Kansas. “We’re going from supply information to demand information, and that’s not looking too good for the wheat market. With these cheap prices, people may find more uses for the product.”
Chicago wheat futures for December delivery on the Chicago Board of Trade fell 1 ½ cents to $4.94 ¼ a bushel. Kansas City wheat futures gained 3 cents to $4.68 ½ at midday.
Corn and soybeans were little changed on a lack of news.
December corn gained ½ cent to $3.58 ¾ a bushel on the CBOT. Soybeans for January delivery rose ¾ cent to $8.56 a bushel. December soymeal fell 60 cents to $288.20 a bushel, and soyoil gained 0.13 cent to 27.16 cents a pound in Chicago.
In the outside markets, Brent crude futures fell 2.5% to $43.36 a barrel while WTI crude dropped 1% to $40.33 a barrel. Natural gas is up 0.6% in midday trading. The Dow Jones Industrial average gained 0.4%.