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CBOT wheat closes higher on recovery from slide

CHICAGO: Soft red winter wheat futures at the Chicago Board of Trade closed higher on Wednesday in a bounce after Tuesday's slide, with commercial buying and position-squaring ahead of Friday's release of US quarterly stocks and plantings reports also noted, traders said.

CBOT wheat closed 1 to 3 cents higher with May up 1-1/2 at $2.51-1/4.

The US Department of Agriculture was scheduled to release the quarterly grain stocks and prospective plantings reports on Friday morning.

Traders said the market was also in a technical recovery from Tuesday's slump to 3-1/2 month lows amid improvement in the condition of the US winter wheat crop and forecasts for beneficial near-term crop weather.

Weather Services Corp. meteorologist Joel Burgio said showers were likely Wednesday through Friday in the southern US Great Plains hard red winter wheat region.

Dry weather was likely Saturday but additional showers were likely in the Plains Sunday especially in the eastern portion of the hard red winter wheat growing region, he said. News that Egypt bought US wheat may have bolstered futures some. A private Egyptian company bought 55,000 tonnes of US hard red winter wheat at $123.70 per tonne, cost and freight, early Wednesday and efforts were under way to buy more, US exporters said.

Exporters said the Egyptian company tendered overnight for 90,000 to 150,000 tonnes of US or Australian wheat.

Egypt is typically the world's largest wheat importer and the United States normally its top supplier.

But earlier Australia's national wheat exporter AWB Ltd said it was optimistic about its sales prospects to Egypt, although disappointed the country's head buyer had decided to step down.

In other export news, the US Commodity Credit Corp. reportedly was seeking 200,000 tonnes of wheat for export programmes.

South Korea's Cheil Jedang Corp 01040.KS and Dongah Flour Mills Co Ltd jointly bought 21,800 tonnes of US No. 1 wheat on Wednesday. Shipment was set for May 20 to June 20 Pusan port.

Technical traders cited support in the May contract at $2.47-3/4 and resistance at $2.53-1/4.

Funds sold 200 lots. Cargill Inc. bought 400 May contracts, E.D. & F. Man International bought 300 May, Tenco bought 200 May, ABN Amro sold 700 July and R.J. O'Brien sold 600 May.

CBOT wheat futures volume was estimated by the CBOT at 15,000 lots, below the 19,140 lots traded Tuesday.

Wheat options volume was estimated at 4,400 lots.-Reuters