Spring wheat futures at the Minneapolis Grain Exchange roared higher on Thursday on fund-buying following a strong weekly export sales report and a bullish private crop estimate, traders said.
MGE December wheat closed up 8-3/4 cents, or 2.4 percent, at $3.68-1/4 per bushel, with deferred months up 2 to 10 cents. Buy stops were hit in December at $3.67, traders said.
Funds bought 1,000 to 3,000 contracts on the day, with UBS Warburg the biggest buyer throughout the session, traders said. Volume was estimated by the exchange at 9,583 contracts, up sharply from 2,958 on Wednesday.
Minneapolis wheat got lift from slipover strength from the Chicago wheat market, where futures rallied on short covering. Also, Memphis-based analytical firm Informal Economics said US spring wheat production would be less than what the US Department of Agriculture forecast in August.
Trade sources said Informal pegged spring wheat production at 504 million bushels, well below USDA's August outlook for 553 million.
Informal put durum production at 87 million bushels, below USDA's August forecast for 93 million.
The wheat complex had added support from strong weekly export data. The USDA reported weekly export sales of US wheat at 805,700 tonnes, above estimates for 400,000 to 600,000 tonnes.
Overnight export news included Japan's purchase of 130,000 tonnes of wheat, with 85,000 tonnes coming from the United States. Traders in Singapore said South Korea set a tender to buy 20,000 tonnes of US wheat on Friday.
Export sources also pointed to freight tender issued on Thursday that confirmed recent market talk that a tender is on the way for 65,000 tonnes of hard wheat for Jordan.
Weather was a mixed bag for wheat futures. Hot and dry weather through on Saturday will continue to deplete soil moisture reserves in the US Great Plains hard red winter wheat region, Meteorlogix weather service said on Thursday.
However, there is a chance that fallout from Hurricane Rita may bring showers into the southern Plains on Sunday and Monday.
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