Minneapolis Grain Exchange spring wheat futures ended down on Wednesday on higher-than-expected wheat stocks data from Canada and declines in other grain markets, traders said. March closed 2-3/4 cents lower at $3.38 per bushel. Deferred months also closed lower. July hit a contract low of $3.27, sliding below the previous mark of $3.27-1/2. A new contract low also was set in the December.

Country Hedging and Cargill Investor Services each sold 100 March contracts, traders said.

"The Canadian numbers were a little higher than everybody expected. Then we've got continued pressure from the outside markets. I think that's dragging us down," one source said, referring to contract lows in Chicago Board of Trade soybeans and declines in CBOT corn and wheat.

Statistics Canada on Wednesday reported Canadian all-wheat stocks as of December 31 at 20.9 million tonnes, up 16.7 percent from the previous year and above the average trade estimate of 20.4 million.

Stocks of Canadian durum wheat were reported at 4.85 million tonnes, up 25.3 percent from the previous year.

In another reminder of large world supplies, the European Union was expected on Thursday to decide on the size of its first wheat export subsidies in 18 months, aimed at reducing a grain surplus.

Overnight export business offered nothing bullish. Syria set a tender to sell 100,000 tonnes of wheat.

But futures found underlying support from the heavy net short position in MGE wheat maintained by large commodity funds, which leaves the market open to short covering.

Traders estimated support in March wheat at $3.34 and $3.28 per bushel, and resistance at $3.48 and $3.51.

Copyright Reuters, 2005