Wheat Commentary
March Chgo Wheat closes 10 ¾ cents higher ($4.35 ½), May 13 ¼ cents higher ($4.57) and July 12 ¼ cents higher ($4.70 ¾)
March KC Wheat closes 14 ¼ cents higher ($4.65 ½), May 13 ¾ cents higher ($4.77 ¼) and July 13 ½ cents higher ($4.88 ½)
Weekly Wheat Export Sales – old crop vs. 300-500 K T. expected – new crop vs. 100-300 K T. expected
Looks like continued short covering in Chgo wheat and continued new buying in KC wheat. I get the impression the trade is finally recognizing the noticeably lower winter acres and the noticeably dry western half of the central southern Plains. Other news of note was lacking on Wednesday. When the funds want to move it is very difficult to stand in front of them.
Some interior wheat basis changes are being noted as they roll from March to May (and in some cases July). Burns Harbor rolled to May at a 10 cent spread. The Ohio River rolled to July; went from 20 under the march to 20 under the July. Chgo spreads continue to widen as deliveries against the March contract continue to look for a home. KC spreads are on a slight firming trend as deliveries continue to be light over there. Last week I was remarking at the strength at the Gulf for HRW; not so much anymore.
July Chgo wheat has been a up trending channel since the first of the year. Monday’s lows tested the support of that channel and have since rallied nearly 20 cents. As of this writing the mid-high $4.70’s may prove to be formidable resistance. July KC has a similar picture but as of this writing appears to be the stronger of the two. Daily momentum indicators for both markets are turning higher after last week’s correction. It finally looks like my idea of long term lows is finally starting to take hold (I hope I’m not cinching it with this statement).
Daily Support & Resistance for 03/02
July Chgo Wheat: $4.64 – $4.74 ($4.80)
July KC Wheat: $4.81 – $4.96
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