May wheat was up 1 3/4 cents late in the overnight session. Outside market forces look bullish today as the significant weakness in the US dollar and new all-time highs in gold lend support. While outside market forces might attract increased buying interest from fund traders, the supply outlooks in India and China appear to be improving, and the trade focus will continue to be on the US crop conditions. The weaker US dollar suggests that US wheat will be more competitive on the world market, but the export wire has been quiet. Sudan is tendering to buy 300,000 tonnes of wheat from any origin. European wheat futures were quiet overnight. The market closed slightly lower on the session yesterday and well off of the highs as profit-taking emerged. China’s interest rate hike news helped pressure the other grains and pulled wheat market lower after a 4-day bounce of as much as 76 1/2 cents. A warm and dry forecast for the winter wheat growing areas plus poor crop ratings to start the season lent support. The first weekly winter wheat conditions report of the season showed that 37% of the crop was rated good/excellent condition compared to 65% last year and 52% as the 10-year average. Kansas City futures closed higher on the session, but this could not support Chicago. 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 the China’s winter wheat conditions are better than expected after the dryness of this past winter. For the supply/demand update on Friday, traders see ending stocks adjusted higher by about 15 million bushels from last month’s estimate at 843 million. World ending stocks are expected to increase slightly.

Bron: CME