Dec Chgo Wheat closes 5 ¼ cents higher ($4.15 ¼), March 4 ¼ cents higher ($4.32) and July 6 cents higher ($4.63 ¼)
Dec KC Wheat closes 7 ½ cents higher ($4.17 ½), March 7 ¼ cents higher ($4.35) and July 7 ¼ cents higher ($4.58 ¾)
Overnight Egypt buys 240 K T. wheat – 60 K T. Romanian; 180 K T. Russian
Speculative short covering buoys US wheat prices on Tuesday. The US had a respectable FOB offer in the Egyptian tender but I have to think freight when applied killed it. European prices as well as Russian prices still appear to have a higher bias. The other day Brazil talked about using hi-pro wheat instead of their high priced corn. That opens the door to later in the season for better export potential. The moisture over the weekend did not hit the drier areas of the central southern US Plains (the western reaches of that area). Tonight there is a freeze warning for that very same area (I’m not an agronomist so I’m not sure of the potential impact). As far as tomorrow’s USDA supplydemand update is concerned the trade is not looking for much in the way of changes for both US and World carryout projections. If there are any surprises it will be lower than expected carryouts.
Interior cash wheat markets continue to be quiet. The export market for HRW is easing just a touch while the export market for SRW has been firming slightly. Chgo spreads are banging up against previously thought resistance levels. KC spreads are firming fractionally.
Flat price wheat continues to be a trading range affair. With a little imagination a case can be made for higher prices over the near term given what has transpired over the past couple of weeks. I’m not advocating chasing a rally but I’d rather play it from the long side vs. the short side. I’m well aware that the last time I thought this I got it stuffed.
Daily Support & Resistance Dec Chgo Wheat: $4.09 ($4.06) – $4.28 (?) Dec KC Wheat: $4.12 ($4.06) – $4.28 (?)
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