December wheat traded 30 3/4 cents lower overnight. The dollar index was sharply higher.

After holding above the previous day's lows on Friday the December wheat contract plunged to sharp new lows for the current move during in the overnight session. Wheat was considered to be a follower on this break with soybeans the clear leader to the downside among the grains. Traders indicate that came as a result of renewed concerns over the economy, particularly in the US and Europe, and fears that the credit crisis has become a major deflationary event. The dollar surged to new highs and crude oil broke below the mid-September lows overnight to add fuel to the break according to traders, although gold traded higher. The tender calendar in wheat remains somewhat light this morning despite the addition of Yemen's tender for 100,000 tonnes this week. Italy has again raised its estimate of their 2008 wheat crop to 4.03 million tonnes from the previous estimate of 3.7 million. The Commitments of Traders Report for the week ending September 30th showed moderate selling by funds. Trend-following funds were net sellers of 1,861 contracts to increase their large net short position to 37,602. Index funds were net sellers of 3,420 contracts, but are still maintaining a long position of over 162,000 contracts. Small traders were net sellers of 2,322 contracts to increase their overall net short position to near 27,000 contracts.

Much of the Plains will see rain today and tomorrow with that system pushing into soft red areas on Wednesday. Saturday and Sunday should see rains in the central and southern Plains and in the western soft red belt with some snow in the far western Plains. Yemen is reportedly tendering to buy 100,000 tonnes of wheat with a bidding deadline this week. Mauritius is tendering to buy 47,000 tonnes of wheat flour from any origin. Jordan is tendering to buy 100,000 tonnes of hard wheat. Bangladesh is tendering for 100,000 tonnes with a closing date of 10/10.