CHICAGO (Dow Jones)--U.S. wheat futures closed near unchanged Wednesday as profit-taking dragged the markets back from early advances.
Soft red winter wheat for March delivery, the most-active contract, closed up 1 1/2 cents, or 0.2%, at $7.64 3/4 a bushel at the Chicago Board of Trade. The contract pared gains after reaching $7.76 1/2, an 18-week high for a front-month contract.
Market participants took profits on the early rally and ahead of next week's holiday-shortened trading week, said Dale Durchholz, analyst for AgriVisor, an Illinois-based agricultural advisory firm. The CBOT, Kansas City Board of Trade and Minneapolis Grain Exchange are closed Dec. 24 for Christmas Eve.
Traders were due to take some profits as the front-month CBOT wheat contract has already climbed 17% this month on world weather worries, analysts said. Excessive rains have hurt the quality of wheat ready for harvest in eastern Australia, although drier weather conditions are easing some of the concerns.
"We've got dry weather through the weekend and through a good chunk of next week, too," said John Dee, president of Global Weather Monitoring, a private, U.S.-based weather firm.
Traders have been nervous about poor weather and tightening global wheat supplies since Russia in August suspended grain exports due to drought, sending wheat futures prices near two-year highs. Uncertainty persists about the size and quality of Russia's next wheat crop, which will be harvested in the spring, because it was planted this fall in dry soil.
Kansas City Board Of Trade
Hard red winter wheat for March delivery fell 3 3/4 cents, or 0.5%, to $8.11 1/4 a bushel at the Kansas City Board of Trade. The contract traded to its highest price since Monday before pulling back.
Profit-taking weighed on futures prices, even though hard red winter wheat in the western U.S. Plains continues to struggle after dryness plagued planting and early crop development this fall. The Plains will see some light snow and rain Thursday and Friday but need more moisture to benefit the crop, Dee said.
In other news, Egypt, the world's top wheat importer, bought 110,000 tons of U.S. hard red winter wheat and 120,000 tons of French wheat in a tender. The U.S. sale was modestly supportive to prices, but the quantity "wasn't necessarily outstanding," Durchholz said.
Minneapolis Grain Exchange
Hard red spring wheat for March delivery slipped 3/4 cents, or 0.09%, to
$8.42 3/4 a bushel at the Minneapolis Grain Exchange. The contract traded to its highest price since Monday before pulling back.
Hard red wheat futures at the MGE and KCBT led the downside after leading advances in wheat during recent weeks. Hard wheat competes most directly with Australian wheat on the global export market.
Rice Futures
U.S. rice futures closed higher in a turnaround from a 1.8% drop Tuesday. The selloff was "overdone" and not justified by changes in supply or demand factors, an analyst said.
Rice for January delivery closed up 5 cents, or 0.4%, at $14.02 1/2 per
hundredweight at the CBOT.
