Wheat Commentary
March Chgo Wheat closes 4 cents higher ($4.23 ½), July 3 ½ cents higher ($4.50) and Dec 2 cents higher ($4.79 ½)
March KC Wheat closes 2 ½ cents higher ($4.22 ½), July 2 ½ cents higher ($4.52 ¼) and Dec 2 ¼ cents higher ($4.88 ½)
Weekly Wheat Export Sales – old crop 300-600 K T. expected – new crop none expected
The recent cold weather forecast for the central southern Plains is finally catching some attention. It is not surprising that Chgo put in a better performance vs. KC as Chgo has the greater concentration of spec shorts. Whether or not the winter wheat crop gets damaged from the upcoming cold blast remains to be seen as any impact from this weather won’t be recognizable until the crop begins to develop in the months ahead.
No changes are being noted in the advertised SRW and HRW interior basis levels. Its hard to detect any type of trend within the SRW basis structure while the HRW interior basis has a very subtle firm undertone. Export prices for both varieties are unchanged but with a firm undertone due to a lack of movement. Chgo spreads ran slightly stronger due to the flat price short covering while KC spreads ran mostly steady out to July.
Flat price put in one of its better performances of late on Wednesday. The day started looking like the recent attempt to rally was rolling over. Prices came within a couple cents of what I perceived to be crucial support but then a bid set in setting the stage for an outside day with a higher close. As long as the cold weather forecasts persist US wheat futures should support/short cover.
Daily Support & Resistance for 12/21
March Chgo Wheat: $4.18 – $4.31
March KC Wheat: $4.18 – $4.30
The risk of trading futures and options can be substantial. Each investor must consider whether this is a suitable investment. Past performance is not indicative of future results.