May wheat was up 15 3/4 cents late in the overnight session. Outside market forces look positive with the weaker dollar and strength in other commodity markets. Weather concerns for the southern US plains, Canada, China and Europe and ideas that demand could turn more positive ahead has helped spark a dramatic turn up from Friday’s lows. The weekly Crop Progress report showed that 36% of the winter wheat crop was rated good/excellent compared to 36% last week and 69% last year. The 10 year average for this time of year is 50%. Kansas crops were just 25% good to excellent, down from 28% last week and 71% last year. Ohio conditions improved, but Oklahoma slipped to just 7% good to excellent from 73% last year and a record low 5% in 2006. The report also showed that just 5% of the spring wheat crop was planted, compared to 18% last year. The 10 year average for this time of year is 14%. The lowest percentage completed at this time was 3% in 1997. July wheat closed sharply higher on the session yesterday and up 45 1/2 cents from the lows from Friday. Talk of more snow and wet weather in the northern plains for the coming week, fears of difficulties in getting the spring wheat and Canadian Prairie crops planted, a dry forecast for the next week for the southern plains, talk of potential irreversible yield damage in China if there is no rain in the next week or two, and dryness concerns for France and Germany are all weather factors that helped support the solid gains. In addition, traders suggested that there was some light damage for winter wheat crops due to freezing weather over the weekend as far south as the Texas Panhandle. Outside market forces were considered negative, but buying was active do to the potential impact the poor weather would have on yields for the new crop season. News from Russia that they will not lift their export ban until at least July added to the positive tone. The surge higher in the US dollar and weakness in equity markets failed to pressure wheat prices. A Canadian Wheat Board official indicated that producer plantings in western Canada are now expected to be ten days to three weeks behind schedule. Lebanon is tendering to buy 50,000 tonnes of milling wheat, and Bahrain is tendering to buy 30,000 tonnes. Iraq plans on importing 3.25 million tonnes this year, up from 1.9 million tonnes last year. Weekly export inspections, released during the session yesterday, came in at 35.7 million bushels, which was higher than expected and above the 31 million bushels necessary each week to reach the USDA projection. Cumulative exports have reached 83.3% of the USDA forecast for the season versus with the 5-year average for this time of the year of 86%. July Kansas City wheat was up as much as 39 1/2 cents at one point yesterday and closed 30 1/2 cents higher on the session. It was as much as 20 cents higher overnight.

Bron: CME