Nearby spring wheat futures at the Minneapolis Grain Exchange closed above US$8.00/bu for the first time since the 25th of June 2013. The US weather forecast calls for a continuation of the hot, dry weather across the northern plains exacerbating the current drought conditions on spring sown crops.
With a holiday in the US tonight the day sessions was shortened but there was plenty of volume as punters got in on the buy side. The session, although primarily about the weather outlook for the northern plains did also see continued carry over buying from the Friday session when the USDA acreage data came in smaller than expected for soybeans and wheat.
Corn was dragged higher by the rally in wheat and soybeans and most punters expect to see some upside in canola values at the ICE as it plays catch-up after a day off. Paris rapeseed futures were firmer by €4.25 / tonne on the nearby.
The speculators in the US are driving the rally in wheat at present. Some believe abandonment maybe as high as 10% in spring wheat while others are happy to work on the USDA estimate of 3.7%. The 5 day GFS weather model indicates the US northern plains and southern Saskatchewan will miss everything this week.
Technically the SRW Dec contract has gapped higher around 550c, gaps get filled, this market is now very overbought.