December wheat traded 13 3/4 cents higher overnight. The dollar index was sharply lower again. Crude oil and many financial markets were again higher.

Wheat rallied yesterday in conjunction with a sharp rally in financials. Funds were moderate buyers on the day. Other buying was said to be local, and commission house short covering which enabled wheat to gain sharply on corn to end the day. The export calendar remains active with Egypt announcing yesterday that it had bought US wheat for the second week in a row. The purchase broke down to 120,000 of US soft red wheat and an additional 145,000 tonnes from Russia for a total of 265,000 tonnes. The Buenos Aires Grains Exchange said yesterday that the Argentine wheat crop may be down 28% from last year due to drought. This compares to their previous estimate of a 25% drop and confirms ongoing damage to the Argentine wheat crop despite good rains over the latest weekend and into yesterday. Russia reported that it has bought 59,940 tonnes of grain domestically as part of its price support system. This was the 17th day of buying in that regard. Russia also reported that it has exported 6.82 million tonnes of grain in the period starting July 1st and extending through October 7th. This included 6.04 million tonnes of wheat. Weather is a minor factor in the US, although rains that are expected tomorrow across most soft red wheat areas may improve early growing conditions there. This may be countered somewhat by expectations of below normal temperatures later this week and starting again next week.

Rains are expected today and tomorrow in the southern Plains, and this should benefit the emerging winter wheat crop there. More rains are expected across soft red growing areas tomorrow, which should also be beneficial. Frost is possible later this week in the upper Midwest. 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.