May wheat was down 5 1/4 cents late in the overnight session. Outside market forces look negative, led by a higher US dollar and weakness in world equity markets. Deliveries against the March contract came in at 89 contracts overnight. The steep drop in the past three sessions leaves the market somewhat oversold going into the USDA supply/demand report this morning. Traders expecte see a slight revision lower in US ending stocks of 5-10 million bushels from 818 million last month and a very slight decline in world ending stocks. Wheat was not down as hard as other grains overnight, as traders saw a potential shift to hotter and drier conditoins for the US southern and central plains as a positive force. Crop conditions might improve slightly from current poor levels due to recent rain and snow, but traders see western Kansas drying out quickly. May wheat collapsed to trade sharply lower on the session yesterday. The market fell sharply into the mid-session, with a bearish tone seen across a wide range of agricultural markets. Weakness in the other grains and a continued long liquidation selling trend helped drive the market sharply lower on the day and below the February 23rd lows, which pushed the market to its lowest level since December 1st. Follow-through technical selling after the weak action Tuesday and talk of improving supply outlook for China, India and the Black Sea region producers also helped to pressure prices. A drier forecast for the central and southern plains in the Midwest helped to provide some support for higher trade early in the day. Traders see weekly export sales for release ahead of the opening near 750,000 tonnes. Supply pressures are mounting for India to allow some increase in exports of wheat on the world market, but traders see the politics of inflation and elections ahead as a reason to suspect no action. India wheat stocks as of March 1st were 17.2 million tonnes, compared with 8.2 million as a target.

Bron: CME