Wheat Commentary

storck

Just My Opinion – Wheat

Wheat Commentary

Dec Chgo Wheat closes ½ cent lower ($4.26 ¾), March 1 cent lower ($4.43 ¾) and July 1 ½ cents lower ($4.69 ½)

Dec KC Wheat closes 1 cent higher ($4.27 ½), March 1 ¼ cents higher ($4.45) and July unchanged ($4.74)

Egypt announces an overnight optional tender for wheat – Egypt overnight buys 120 K T. Russian wheat – US origin was not offered

Flat price wheat starts the day under pressure stemming from the cheap looking Russian sales to Egypt. The US just cannot compete with them. Dec Chgo what came within 3 cents of contract lows before rebounding. The rebound was led by the Mpls contract which appeared to be positioning for the USDA report tomorrow. The thought is that if the wheat report shows any signs of friendliness it will come from the “hard” sector; HRS specifically. At one point during the day Mpls was up 14 cents, KC up 1 cent or so while Chgo struggled to retrace back to unchanged. I get the impression that the spec fund short is fighting furiously to keep the Chgo market under wraps. The USDA is not expected to make any material changes in its updated Supply-Demand report tomorrow.

Interior cash wheat prices continue to be quiet. Bids for SRW at the Gulf have slipped some from last week’s firmer postings. The Gulf bid for HRW continues to look strong. It has to be noted that bull spreads were working within all of the US futures markets (Chgo, KC and Mpls).

Flat price challenges suspected support levels that were created last week and held. Are the spread improvements trying to tell us that we don’t need to go any lower from what we saw last week? I know I don’t want to be short. Today’s price action, testing suspected support and holding, is trying to suggest that maybe the worst is behind us. Unfortunately we have yet to see the price action confirm this. If we can take out and close above Monday’s high it will be a step in the right direction.

Daily Support & Resistance for 11/09

Dec Chgo Wheat: $4.20 – $4.40

Dec KC Wheat: $4.20 – $4.40

 

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