Wheat Commentary

storck

Just My Opinion – Wheat

Wheat Commentary

May Chgo Wheat closes 13 ½ cents lower ($5.14), July 14 ¾ cents lower ($5.11 ½) and Dec 12 ¼ cents lower ($5.50 ¾)

May KC Wheat closes 16 cents lower ($5.19 ¾), July 16 ¼ cents lower ($5.39 ½) and Dec 14 ¼ cents lower ($5.83 ½)

Weekly Wheat Export Inspections – 327.6 K T. vs. 275-500 K T. expected

US Winter Wheat Ratings – 34% GE (+1%) vs. 34% expected

US Spring Wheat Planting Progress – 30% planted vs. 31% expected vs. 51% 5-year average

A lack of business coupled with the idea that the US HRW crop is improving had wheat prices on the defensive virtually all session long. I’m not so sure the HRW is really improving but there is some rain in the forecasts over the next 10 days or so. Adding to this were ideas that the dry areas of concern in Europe and the Black Sea region could see some moisture relief later this week. The bottom line is that if wheat crops worldwide are going to improve over the near term and the US has no business to speak of prices need to go lower in an effort to attract demand.

Cash wheat prices whether for domestic of for export are quiet suggesting no real need from any of the sectors. Recent spread strength, July forward, has evaporated faster than we saw it strengthen. This holds true for both the Chgo and KC markets.

Daily momentum data for both Chgo and KC wheat markets appear to be in the process of rolling over. Last Monday July Chgo wheat created a gap at the $4.99 to $5.00 ¾ level. I’m not sure we can get there on the current down wave as short term data is starting to read oversold. I think to get to the gap level we’ll have to see some sort of a minor rally first. Chasing short term extremes in the wheat market has not been very good to me so with said I guess I’ll be sitting and watching for now.

Daily Support & Resistance for 05/08

July Chgo Wheat: $5.04 – $5.20

July KC Wheat: $5.30 – $5.50

 

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