Wheat Commentary
Dec Chgo Wheat closes 7 ¼ cents lower ($4.24 ¼), March 5 ¾ cents lower ($4.43 ¼) and July 4 ½ cents lower ($4.68 ½)
Dec KC Wheat closes 5 ¾ cents lower ($4.27 ½), March 5 ¾ cents lower ($4.44 ¼) and July 4 ¾ cents lower ($4.72 ¾)
Weekly Wheat Export Inspections – 301.0 K T. vs. 250-450 K T. expected – Cumulative to date – 11.728 M T. vs. 12.435 M T. year ago
Weekly Winter Wheat Ratings & Progress – 54% GE (-1%) vs. 56% expected vs. 59% Year ago – % Planted vs. 95% Expected vs. 95% 5-year average
After last week’s attempt to rally in the face of bearishness elsewhere within the Ag sector US wheat markets fell flat on their faces Monday. The break was led by the Mpls market which had shown the best strength last week. I think the US markets took their cue from soft Black Sea prices. I did see a lot of inter-market spreading among the varieties which I’m assuming was re-alignment from last week’s strength led by the Mpls market. The KC market was the least weak; I’m thinking that is in response to a protein play.
Interior cash wheat markets remain quiet but reading between the lines one will think a touch softer. SRW continues to be quiet a the Gulf while HRW eases some form its recent strength. Chgo intra-market spreads had been firming in recent days ran noticeably softer on Monday. Chgo spreads have been influenced by its proximity to VSR changes 9 days from now. I’m told 16 ½ cent carry averages to 17 ½ cent carry averages, above or below, will dictate whether or not mandated storage costs tighten or stay where they are.
Late last week I had been thinking the wheat market may be in the midst of trying to establish a bottom. After today’s price action the Chgo and KC markets look like short term up flagging vs. bottoming formations. For the near term I’ll lean towards a sideways mode as if the corn and soy markets are going to move lower wheat just may become the recipient of the long side on inter-market spreads.
Daily Support & Resistance for 11/14
Dec Chgo Wheat: $4.20 – $4.38
Dec KC Wheat: $4.22 – $4.40
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