FX.co ★ Wheat review for June 29, 2011

Wheat futures grew on Wednesday amid closing short positions before an important report on grains reserves of the US Agriculture Department is released. Increasing futures also supported the market.
By the end of CBOT trades September futures on wheat gained 1 ½ cent and constituted USD 6.74 ¼ per bushel.
As corn futures showed growth prices for wheat declined on Wednesday. Moreover, rising wheat futures in Europe also spurred the market up which was oversold, traders say.
Market participants are anxiously waiting for the US Agriculture Department report which will reveal the grain reserves state and seeding area. The latter will be particularly important for traders as heavy rains earlier this spring caused delays in seeding in Northern parts of Grain Plains. However, negative influence of natural disasters was already reflected in the governmental report published earlier this week. The US Agriculture Department announced on Tuesday that 60% wheat harvest is estimated as being in decent condition which is 3% less as compared to the previous assessment. Meanwhile, the national government lowered the estimation of harvest in Minnesotta and North Dakota by 4% and South Dakota - by 6%.
Analysts forecast that the wheat harvest constituted 12.32 mln. acres which is much lower than March forecast of 14.43 mln. acres. This fall may be caused by heavy raining and cold weather earlier this year.
According to the data published on Wednesday, exported wheat sales equaled 120 000 tons in an unknown direction with 2011-2012 supplies.
South Korea bought 220 000 tons of wheat. These announcements supported the market.