Yesterday's rally was quickly erased in a high volume night session.
Volume was triple the normal
overnight level as wheat shed 7 1/4 cents in Chicago. Weekly USDA
Export sales this morning arrived
at the low-end of expectations at 325,000 tons for 9/10. Nigeria who
had been a big buyer over the past
several weeks is notably absent from the sales this week. Bids in
recent tenders have illustrated just how
uncompetitive US wheat is on the export scene. Algeria for 300,000
tonnes of milling wheat at around
$190 a tonne, cost and freight included, for shipment in LH May/FH
June and Tunisia's snap tender for
75,000 mt of opt origin Wheat for shipment late May to early July
with lowest bid so far at $190.89/mt.
Chinese demand for Australian wheat has surged to levels not seen
for at least five years, sucking in an
estimated 400,000 tonnes of grain in the past five months, but this
is not necessarily positive. In the U.S.
basis levels remain at historic margins, MPLS and KC continue to
gain on Chicago as protein draws
premium within the market. Possible flooding in the Red River Vally
could also hinder spring wheat
planting. Kazakhstan wants to double shipping subsidies for grain
producers to encourage them to boost
exports at a time of falling global prices. Strategie Grains cut by
600,000 tonnes its monthly estimate
for the European Union's 2010 soft wheat crop, partly to reflect the
impact of recent freezing weather in
several EU countries.
Trade overnight reversed much of yesterday's action. Chicago wheat
closed down 7 1/4 cents in the
May with 65062 contracts changing hands. In Kansas City, wheat
finished down 6 3/4 cents and in
MPLS wheat finished down 5 1/4 cents. Kansas City is now 6 3/4 cents
premium to Chicago and MPLS
is 25 1/4 cents premium Chicago in the July.
Globex Overnight
Contract Last Net Change High Low Volume
ZWK10 488^6 -7^2 494^6 488^0 6506
ZWN10 501^0 -7^6 508^0 500^6 5522
ZWU10 517^0 -7^6 520^4 516^6 558
KEK10 495^4 -6^6 501^4 495^4 275
KEN10 506^0 -6^6 511^4 506^0 129
MWEK10 515^0 -5^2 519^6 515^0 95
MWEN10 526^2 -5^0 528^4 526^2 69
Early Opening Calls: off 4-6 cents
Top News
**USDA Wheat 09/10 Export Sales Net: 325,300 mt; 10/11 Net: 114,000
mt; expected 300k-450k mt
-- 2010 EU soft Wheat production pegged at 134.1 mln mt a drop of
600,000 mt by Strategie Grains
-- Tunisia's gov't grainary issued a snap tender for 75,000 mt of
opt origin Wheat for shipment late May
to early July
-- Traders say in today's snap Tunsia tender for Wheat, lowest bid
so far is $190.89/mt
-- In a planned regular tender, Japan's Ag Ministry bought 136,000
mt of food grade Wheat from US,
http://www.linngroup.com Page 2 of 2 312.896.2001
Reproduction or rebroadcast of any portion of this information is
strictly prohibited without the written permission of the Linn
group, inc. the information reflected herein is derived from sources
believed to be
reliable; however, this information is not guaranteed as to its
accuracy or completeness. Opinions expressed are subject to change
without notice. this material and any view expressed herein are
provided for
informational purposes only and should not be construed in any way
as an inducement to buy or sell commodity futures or options
contracts. The Linn group and its officers, directors, employees and
affiliates
may take positions for their own accounts in contracts referred to
herein. Trading futures involves risk of loss. Past performance is
not indicative of future results.
Aussie & Canadian origins. Is expected to load out Apr 21 to May 20
-- Brazil's central bank surprises markets by holding key interest
rate steady, many traders had expected
an increase - Brazil currency opens weaker versus the US$
-- Western US temp outlook by NOAA is for above average in the April
through June period
-- NOAA outlook sees Great Lakes and PNW regions with above normal
temps in April. Southeast &
southcentral US will see below normal temps during April, acc. to
NOAA report
-- Pending Tender: 25,000 mt of food grade Wheat is being sought by
Japan's Ag Ministry in a Friday,
Mar 19th SBS tender.
-- Pending Tender: Merchandisers say 50,000 mt of mill grade Wheat
being tender for by Algeria,
shipment is for May time period
-- Pending Tender: UN Food Agency seeking 10,000 mt of mill grade
Wheat for donation to Palestine in
a Tuesday Mar 16 tender. The volume is to be split for delivery in
LH Apr/FH May and the other half
for delivery LH June/FH July
-- Pending Tender: 21,500 mt of mill grade Wheat sought in Tuesday
Mar 16 tender by UN Food
Agency with donation and shipment to Ethiopia for April
-- Pending Tender: 136,000 mt of US, Canadian, Aussie Wheat sought
by Japan's Ag Ministry it's its
usual Thursday tender, Mar 18
-- Pending Tender: Iraqi Grain Board reportedly looking to purchase
minimum of 100,000 mt of Wheat
in newly announced tender, acc. to traders
-- Pending Tender: March 9th is deadline for UN food agency tender
for 56,000 mt of Wheat for
donation to Ethiopia. This 56,000 mt volume is in addition to
another 64,000 mt purchase also destined
for Ethiopia
-- Pending Tender: Mar 19th is date set for Japanese SBS tender,
they'e seeking 25,000 mt of food grade
Wheat, acc. to ag ministry official
-- Pending Tender: A 70,000 mt optional origin Wheat tender was
again refloated by Bangladesh on
Thursday, Acc. to state official. The bid deadline for this tender
is set for March 25th
-- Liffe May Milling Wheat went out up +0.25 @ 124.25
-- Globex Wheat Vol. 57,069; Pit Vol. 1,427; Open Interest Change: +
1,122
-- Weather: 6 - 10 Day Forecast: Normal to Below Temps. Normal to
Below Precip.
-- Outside markets: Energy Complex -0.35 at $82.58; Gold & Silver:
+2.7 at $1126.9 & -0.003 at
$17.520; US $ +0.325 at $80.175
Cash Markets
-- CIF SR Wheat: Mar. +35 to +?? Apr. +30 to +45 July +28 to +35
--
John Christopher
Linn Group
312.896.2061
Wheat
Morning Update & Commentary: