Wheat Commentary
May Chgo Wheat closes 2 ¼ cents higher ($4.53), July 1 cent higher ($4.68 ¾) and Dec ¼ cent higher ($5.06 ½)
May KC Wheat closes ¼ cent lower ($4.70), July ¼ cent lower ($4.87 ¾) and Dec ½ cent lower ($5.28)
Chgo flat price wheat makes new lows for the move by fractions but does not look to convincing in regards to rejecting this level. Flat price KC wheat makes new lows for the move by a couple of cents but this market too does not look very convincing in its efforts of trying to reject this level. Trade chatter was about whether or not the central southern Plains are looking at a weather pattern change. Demand is not being discussed as I’m being told that despite the recent massive break US origin wheat is still not very competitive. As we look ahead to next week’s USDA reports, Quarterly Stocks and spring wheat planting most are shrugging their shoulders. The attitude is the competition’s winter wheat is in great shape so who cares how much or how little we have if no one wants it.
Interior cash wheat markets remain quiet. Toledo still has its nose up looking for wheat. The Gulf doe SRW is quiet. Bull spreads in Chgo were noticeably working. I have to think that’s reflecting Toledo’s need for quality SRW. The Gulf market for HRW continues to slide. The bid for HRW at the Gulf is down 35 cents since the 1st of the month. Couple that with the 70 cent break in the flat price in the very same time frame and it spells U-G-L-Y.
The only positive I saw in the KC wheat today was that it filled a breakaway gap dating back to Jan 29th, Jan 30th and managed to close above the gap. Numerous times during the day the flat price tried to rally out of the hole only to get beaten back – it looked like continued liquidation to me. My bias for the near term is consolidation with a slight edge to the downside. I don’t think there is a lot left to this sell off but that doesn’t mean the market is going to turn around and rally right back up. Sideways with an easier slant here we come.
Daily Support & Resistance for 03/21
May Chgo Wheat: $4.45 – $4.62
May KC Wheat: $4.62 – $4.79
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