Afternoon wheat commentary: The theme of the day was more profit taking in both outright Spring wheat futures, and spreads

The theme of the day was more profit taking in both outright Spring wheat futures, and spreads. It started yesterday, with the markets test, but subsequent failure to move into new contract highs following another downgrade in Spring wheat conditions by the USDA on Monday afternoon. Granted, conditions are abysmal, but this is nothing new to trade, and even though trade is still uncertain if there will be much of a crop to export, and where Spring wheat ending stocks may ultimately finish, the market needs some fresh input and/or data to revitalize trade. Maybe that will come next week when the Wheat Quality Counsel crop tour begins in North Dakota. Until then, trade has to deal with some liquidation, and so far, that has come in the form of roughly 25-cent losses over the past two sessions. The Mpls/Chicago spread has lost 37 cents over the past couple of days, and the Mpls/KC spread has lost over 40 cents.

Even though both Chicago and KC posted solid gains today (eight to ten cents higher), and today's gains made it six consecutive sessions with a higher close, technically, each market had an inside day, which could make tomorrow's trade all that more important. A settle above Tuesday's high would open the door for a run at May's highs ($7.67 ½ in Chicago Sept and $7.45 ½ in KC Sept). A failure and reversal and ultimate settle below Monday's lows would open the door for a further correction of around twenty cents.

HRW basis bids saw little change again on Wednesday. Bids for 11-pro stayed +90/100, the 11½-pro remained +105/115, the 12-pro stayed +145/+155, the 12½-pro remained +161/171, and the 13-pro stayed +185/195. HRW export bids also saw little change on Wednesday. For July, ORD remained +110, the 11-pro firmed five to +125, and the 12-pro stayed +175. For Aug/Sept, ORD stayed +110, the 11-pro fell one to +125, and the 12-pro remained +180. For O/N/D, ORD remained +120, the 11-pro stayed +140, and the 12-pro stayed +180. SRW track bids down to the Gulf saw no changes again on Wednesday. July stayed 30/33, Aug remained 33/40 and Sept stayed 45/50. HRW track bids down to the Gulf also saw no changes. July stayed 175/185, and both August and Sept remained 180/190.

Headline News:
Thus far, Russian wheat farmers have harvested 23.5 MMT of wheat compared to the 27.7 MMT this time last year. Yields are averaging 3.45 mt/ha, slightly below the 3.47 mt/ha last season.

Export sales will be out in the morning. There was only one morning sales announcement, 134 TMT of SRW sold to China, but there was plenty of Global wheat demand around. Last week's wheat sales came in at the high end of expectations, and sales tomorrow should be good again. Look for between 400 and 600 TMT.

Export business this week:
*** Russian wheat exports last week were only 100 TMT.
*** Bangladesh passed on all offers in their two tenders, each for 50 TMT of milling wheat. The low offer had been $335.00/mt.
*** Ethiopia is in for 400 TMT of milling wheat.
*** July 27 Jordan is back in for 120 TMT of wheat.