In the overnight session the grains traded higher with corn up 3/4 of a penny, soybeans up 3 cents and wheat in Chicago up 3 3/4 cents. Yesterday wheat continued trading lower throughout the better part of a day but bounced off support and closed 6 1/2 cents off its intraday lows. Both $4.84 and $4.85 were previous lows from March 6th and April 16th respectively and provided some buying support during yesterday’s session. During today’s trade session we might see continuation of the bounce seen yesterday, but it is important to remember that wheat is still firmly stuck in a downtrend and that selling pressure is likely to be the more dominant force in the long run.
The International Grains Council raised its forecast for global 2015/16 corn and wheat output on Thursday. The council raised wheat production to 715 million metric tons up from a previous projection of 705 million metric tons. Although this is a substantial jump from previous forecasts, it is still below last year’s production levels of 721 million metric tons. The world corn crop was revised higher by 10 million metric tons to 961, below last year’s production levels of 997 million metric tons.
Purchasing activity seems to be picking up as the state grain buyer for Egypt set a tender on Wednesday for an unspecified amount of wheat from global suppliers this morning. Japan bought 100,262 metric tons of U.S. wheat in a tender that closed on Thursday and Algeria purchased 540,000 metric tons of grain last week from optional-origin which was more than the 450,000 reported. The dollar is trading only slightly higher this morning after jobless claims rose to 282,000 metric tons from 275,000 a week earlier.