Wheat futures on the Chicago Board of Trade were 2 percent higher by midsession on Wednesday as the market refocused on tight global supplies of old-crop wheat, with firms viewing Tuesday's setback as a buying opportunity, traders said.
World wheat stocks are forecast to drop to a 30-year low by the end of the marketing year on May 31, 2008, and the US stockpile is seen falling to a 60-year low. Concerns that Russia may limit grain exports in February lent support. Russia's agriculture minister said Wednesday the country may curb grain exports around February 1 after they reach a level that might create a shortage on the domestic market.
However, CBOT traders also said much of the market action was technical in nature, based on positd-year holidays.(1645 GMT), CBOT March wr 2 percent, at $9.71 per bushel, but stayed inside of Tuesday's trading range.
Back months were up 5 to 20 cents, with new-crop July up 15 cents at $7.84-1/2. The market drew strength from news that Japan plans to double next year's budget for milling wheat imports to $3.3 billion, expecting the rally in wheat prices to extend into next year.
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