Wheat prices plunge

Market Line February 16, 2011 Futures and cash wheat prices had big drops Tuesday with futures losing as much as 37 cents. Some traders pointed USDA’s announcement of the cancellation of a soybean sale to unknown destinations as a trigger for a sell off in grains. Some traders think the recent increase in demand for U.S. wheat won’t hold up. Egypt did tender after the close though for optional origin hard and soft wheat.

Weather news for the U.S. southern Plains and China was also viewed as bearish but USDA meteorologist Brad Rippey says a warm up in the southern Plains may reveal the winter damage there.

Rippey: “We may well find out this week just how some of that drought stressed, poorly established and winter stressed wheat is going to fair and I am afraid in some cases the news won‘t be all that good.”

On Tuesday Chicago March wheat down 31 ¾ cents at 8-40 ¼. March corn down 5 ¼ cents at 6-90 ½. Portland soft white wheat by rail only, five to 20 cents lower at mostly 8-58. Club wheat premium at Portland mostly 17 cents.

New crop August white wheat was 25 to 30 cents lower at 8-30 to 8-50. Hard red winter 11.5 percent down 33 cents at 9-47. DNS 14% protein down 37 cents at 11-66.

Live cattle futures were mostly lower Tuesday with feeder contracts mostly higher. Commentators said a sell off in grains was negative for live contracts as more animals may be fed and that helped feeder contracts as feed costs could be lower. April live cattle down a dime at 113-77. March feeders up 15 at 128-52. March Class III milk up four cents at 18-77.

(Source: http://www.aginfo.net/index.cfm/event/report/id/Market-Line-18552)