May wheat was up 5 cents late in the overnight session. Outside market forces looked quiet but the firm tone to the US dollar was a slight negative. Some mixed weather news helped pull wheat off of the recent highs and allowed it to push lower over the past few sessions. The current active US weather pattern is allowing some parts of the plains to receive scattered rains this weekend, and there are more chances into next weekend. Traders are focused on US, European and Chinese weather as key factors for price direction over the near term. For the supply/demand update on Friday, traders see 2010/11 ending stocks being adjusted higher by about 15 million bushels from last month’s estimate of 843 million. World ending stocks are expected to increase slightly as well. The market closed slightly lower on the session yesterday and appeared to be influenced by weak trade in corn and in Kansas City wheat. Slow export news and increased chances of rain for parts of the hard red winter wheat belt helped to spark some selling, and May wheat pulled back after Tuesday’s rally had pushed the market to its highest level since early March. Volume was light with some positioning noted ahead of a supply/demand update. A sharp break in Kansas City wheat helped spark some selling for Chicago wheat into the mid-session. While much of the western sections of the southern plains winter wheat growing areas look to stay mostly dry ahead, there are forecast for increased rain amounts for the central and northern sections of the belt. A big jump in Indian production was seen as a negative force. India’s Farm Minister believes the wheat harvest could reach a record 84.3 million tonnes, up from 80.8 million last year and up from the previous government forecast of 81.47 million tonnes. Traders also indicate that Chinese winter wheat conditions are better than expected after the dryness this past winter. Northern plains wheat areas in China look to stay dry into next week. Tunisia bought 25,000 tonnes of durum wheat overnight. Russia may have up to 8 million tonnes more grain than previously believed.

Bron: CME