March and May spring wheat futures at the Minneapolis Grain Exchange fell to new contract lows Wednesday morning, traders said. Weak cash markets, bear spreading and long liquidation in the March contract pressured the March/May spread to even money in early trading. MGE March was down 6-3/4 cents at $3.29 per bushel. Other months were down 1/2 to 2-1/4 cents. The new contract low for March is $3.27-1/2, below the previous low of $3.34.

Wheat traders said the futures market continues to erode under the weight of plentiful stocks of wheat globally and on outlooks for satisfactory weather for early seedings of the US spring wheat crop.

Exports were routine overnight and included South Korean flour millers' tender to buy 24,000 tonnes of US wheat. Wheat traders said some large-scale export bids and/or purchases were needed to sustain gains in wheat futures prices.

Several countries continue to report bumper wheat crops. Romania expects to reap 8.0 million tonnes of wheat this year thanks to ideal growing conditions, after a bumper 7.7 million tonne harvest in 2004.

Copyright Reuters, 2005