Wheat futures fall on USDA report

Market Line Oct. 13, 2011 Wheat futures, which were up sharply Tuesday, gave back most of those gains Wednesday as USDA forecast U.S. wheat ending stocks for the current marketing year well above trade expectations at 837 million bushels. Domestic use and exports were reduced.

Bill Tierney of AgResources says many analysts were surprised at the low wheat feeding number but says they shouldn’t have been based on the recent quarterly grain stocks report.

Tierney: “USDA trues up its wheat feed residual number based on the stocks report. So when the stocks came in implying lower than expected feed residuals that has to be fed through.”

Corn was also pressured by higher than expected ending stocks but confirmation of a Chinese purchase lessened its losses.

On Wednesday Chicago December wheat down 34 cents at 6-26 ¾. December corn down 4 ¼ cents at 6-40 ¾. Portland soft white wheat and club wheat eight to 15 cents lower at mostly 6-25. Hard red winter 11.5 percent protein down 19 cents at 7-75. DNS 14% protein 30 to 35 cents lower at 9-96.

Cattle futures were mixed Wednesday. Profit taking was cited and traders were waiting for some cash fed cattle action. USDA did increase this year’s beef production estimate in its supply and demand report yesterday, partially offsetting that with more exports. December live cattle down 40 cents at 121-22. November feeders up 20 at 143-32. November Class III milk down 13 cents at 16-97.

I’m Bob Hoff and that’s Market Line on Northwest Aginfo Net.

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