Wheat futures on the Chicago Board of Trade closed modestly lower on Friday, pressured by a firmer dollar and spillover pressure from corn and soybeans, traders said. A lack of fresh US wheat export sales added pressure. The International Grains Council forecast that global wheat production in 2013/14 would rise 4 percent on the year, from 654 million tonnes in 2012/13.

Front-month CBOT wheat ended the week nearly unchanged, but the March contract fell 0.3 percent. KCBT March wheat fell 0.4 percent for the week and MGEX March spring wheat fell 0.5 percent. Additional pressure stemmed from a surprisingly strong American jobs report for November that pointed to gathering momentum in the economy - a factor that lifted the US dollar and dulled demand for risky assets including commodities.

Trade expects USDA to raise its forecast of US 2012/13 wheat ending stocks in its monthly supply/demand report next week but lower its forecast of global wheat stocks. Market underpinned by ongoing dry conditions in the US Plains wheat belt. US farmers could abandon more than a quarter of the new winter wheat crop due to the weather, though decisions on abandonment will not be made until spring. Earlier this week, forecasts had called for some moisture to hit parts of eastern Colorado, western Kansas and Nebraska this weekend, but updated outlooks showed only light moisture expected in the Dakotas and parts of Colorado.

Copyright Reuters, 2012