Wheat prices up

CHICAGO: US wheat extended gains to set multi-month highs on Friday on follow-through buying after the US Department of Agriculture slashed domestic stockpile estimates in a monthly report on Thursday.

Chicago Board of Trade March wheat finished 5-1/2 cents higher at $4.49 per bushel, the highest on a continuous chart since June 28. Wheat gained 4 percent for the week, the biggest such gain since October.

"USDA increased wheat exports by 50 million bushels," said analyst Joe Christopher of the Crossroads Co-op in Nebraska. "That caught everyone's attention." 

Farmers were selling wheat to take advantage of the higher prices, Christopher added.

The USDA cited increased wheat export shipments to support its estimate of smaller stocks.

The USDA cut its estimate of world wheat ending stocks for 2016-17, largely due to reduced harvest estimates for India and Kazakhstan, although global inventories would still be at a record.

"Lower inventories are obviously a plus for prices," said Tobin Gorey, director of agricultural strategy at Commonwealth Bank of Australia. "Yet we are somewhat skeptical that the news is worth an extra two-and-a-half to 3 percent on wheat prices." 

In Europe, March milling wheat on Euronext reacted to Thursday´s close in Chicago to extend gains and touch its highest since August at 172.75 euros a tonne.