The short-covering rally yesterday took wheat 6 cents higher, following the large short fund positions. Weekly export inspections were 384 TMT for all wheat, a decline from LW and LY. All wheat is 2% behind the pace to reach the USDA estimate mainly due to HRS trailing 7% behind pace, but HRW and SRW are 2% ahead of pace. Egypt continues to struggle to get offers that they consider tradeable on tenders for March shipment, due to concerns over ergot policy. There was an 8 TMT cargo of Canadian spring wheat that was rejected yesterday due to ergot, it was reportedly rejected twice by quarantine authorities. U.S. cash markets started the shortened week on a softer note, as buyers are not scrambling for coverage and futures were moving higher. USD is up 175 points, Crude Oil is up 77 points and S&P futures are up 14.50 points. Look for a slight correction after yesterday’s rally, but fundamentals are not present to keep the move going.
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