December wheat traded 16 cents higher overnight. The dollar index was sharply lower overnight. Many financial markets were higher along with crude oil.

Wheat traded sharply lower to end last week. This came in conjunction with limit down moves in corn and the soybean complex, but wheat remained above limit down while those markets were locked at limit on Friday. Jordan is again tendering for 100,000 tonnes of hard wheat to start the week as the tender calendar continues to be fairly active in wheat. Fund selling was a feature again in wheat on the latest Commitments of Traders Report. For the week ending 10/07, index funds were net sellers of 8,076 contracts to lower their long position to about 154,000. Trend-following funds were net sellers of 2,978 to raise their large net short position to well over 40,000 contracts. Small traders were net buyers of 1,143 contracts to slightly trim their net short position. The USDA's Supply and Demand Report on Friday was considered negative. The 2008/09 yield was raised substantially to 44.9 bushels per acre in the US compared to 43.5 last month, which increased the US supply by 38 million bushels to 2.5 billion. This pushed ending stocks to 601 million bushels compared to 574 million last month and 306 million last year. Exports were left unchanged, which was a bit of a negative surprise. World ending stocks were raised to 144.41 million tonnes compared to 139.89 last month and 119.8 million tonnes last year. This was due to a jump in production to 680.20 compared to 676.28 last month. Russia was raised by 1.0 million tonnes, and the Russian government announced today that bunker weight on grain crops harvested this fall now stands at over 110 million tones. This will be up to 7% higher than the eventual weight after cleaning and drying, but with another 4% of the acreage remaining to be harvested, this puts overall grain production slightly higher than the current official estimates.

Rain is expected to sweep through the southern Plains today with some snow possible in the far northern Plains and into Canada. This system will sweep eastward through the Midwest tomorrow and Wednesday which will cause only minor delays to planting and add beneficial moisture. Jordan is tendering for another 100,000 tonnes of hard wheat. Iran is in the market for 60,000 tonnes of wheat from Australian origins. Mauritius is tendering to buy 47,000 tonnes of wheat flour from any origin.