Pre-Opening Wheat Market Report for 11/4/2010
December wheat was up 7 1/4 cents overnight. Outside market forces are positive this morning. The wheat market is responding to a sharply lower US dollar overnight, and traders remain hopeful that the lower dollar along with a tightening supply of exportable surplus from Europe will help boost demand for US wheat. Traders were disappointed this week when Egypt did not buy wheat from the US in their tender, and they will be monitoring the weekly export sales news this morning. The market closed lower for the third session in a row yesterday, as traders appeared to step aside ahead of the FOMC meeting results. A rally in the US dollar helped drive wheat on the day after the higher opening, and this pushed December wheat to the lowest level since October 26th. Fears of Fed actions following their FOMC meeting helped spark some long liquidation selling. Dry weather in the central and southern plains helped to provide some support. Some traders see better rain chances for the region in the 6-10 day outlook period but others see the rains missing the driest key growing areas. The Fed quantitative easing plan did not come as a major surprise for the market but shortly after the announcement, the dollar saw some strength with initially pushed gold and stock markets lower, but 30 minutes later the dollar was pushing lower on the day and the stock market rallied to higher on the session. This action suggested a positive tilt to commodity markets for the news. Japan bought 125,667 tonnes at their weekly tender.