May wheat was up 1/2 of a cent late in the overnight session. Outside market forces have a positive tilt with a lower US dollar and higher gold values. Deliveries against the March contract came in at 74 contracts. The slowdown in deliveries was seen as somewhat positive and traders see active demand from Middle East and North Africa countries as a potential supportive force over the near-term. However, traders see some rains into central and even western Kansas this week which is seen as a negative development over the weekend. Very light, if any, rain is in the forecast for western Kansas but some increased chances were seen as a negative development. China areas look mostly dry ahead but China officials see drought areas declining and also indicate that the country is holding stocks near a one year usage pace. Lebanon bought 22,500 of milling wheat over the weekend with 15,000 of the total from the US. Iraq has bought 400,000 tonnes of wheat over the weekend with 300,000 of the total from the US. Egypt officials indicate that they have at least 5 months of supply on hand and is pursuing a normal buying pace ahead. Weakness in corn and some increase in rain coverage for the winter wheat areas in the forecast models helped cause a significant break in wheat early on Friday but concerns for crop conditions in the western plains helped support a late rally with May wheat closing 8 3/4 cents higher on the session and up 21 cents for the week. A generally dry forecast for the western US plains helped to support the market early with futures moving to the highest level since February 22nd. Talk that the China crop prospects have improved significantly with recent rain/snow and talk of a record India wheat crop harvest soon helped to pressure the market into the mid-session. Weakness in US equity market and ideas that investors are shifting out of agricultural funds and into energy funds added to the negative tone. Ideas that the Ukraine winter grain crops are doing well helped to limit the advance early with traders looking for production to increase 15-18% from last year. The Commitments of Traders reports as of March 1st showed Non-Commercial traders were net long 18,934 contracts, a decrease of 1,165 contracts for the week. Non-Commercial and Nonreportable combined traders held a net long position of 6,287 contracts, down 3,618 for the week. Commodity Index traders held a net long position of 213,602 contracts, up a significant 6,313 contracts for the week.

Bron: CME