FX.co ★ Wheat review for July 27, 2011

Futures on wheat closed with a gain on Wednesday amid purchases for lowered prices, as concerns over harvest in northern regions of the Great Plains are intensifying.
By the end of CBOT trades December futures on wheat grew by 0.7 % up to 6.91 ½ dollars per bushel. September futures on wheat increased by 1.5% and equaled 7.04 ¾ dollars per bushel. November contract on soybean lost 0.6% and constituted 13.80 ½ per bushel.
Many US experts went to fields to assess the quality of the harvest. Their first estimations are suggestive of less harvest as compared to last year. In particular, experts have been concerned about the condition of wheat in North Dakota. It caused more expectations that this year industrial performance will not meet the forecast of the US Agriculture Department.
According to publications, the group of experts sponsored by Wheat Quality Council estimates crop yield at 42.6 bushels per acre while last year it was 46.5 bushels per acre.
This news eliminated concerns of market participants over declining export demand due to more supplies coming from Russia. The market also overlooked a strengthening US dollar. The growth of American currency makes futures more expensive for holders of other currencies.
Meanwhile traders note that closing positions on spreads short wheat/long corn also supported the market.