Wheat Commentary
July Chgo wheat closes 15 ¼ cents higher ($5.30 ½), Sept 15 cents higher ($5.50) and Dec 16 ¼ cents higher ($5.74)
July KC Wheat closes 14 ½ cents higher ($5.41), Sept 14 ¼ cents higher ($5.57 ¼) and Dec 14 ½ cents higher ($5.83 ¼)
Weekly Wheat Export Inspections – 533.8 K T. vs. 400-600 K T. expected
Weekly Winter Wheat Condition & Progress – 67% Harvested vs. 67% expected vs. 65% 5-year average – Condition report no longer updated
Weekly Spring Wheat Condition & Progress – 35% GE vs. 35% expected vs. 70% year ago – Headed – 79% vs. 74% 5-year average
Mpls continues to carry the ball (influence) whether it’s up or down. Monday’s influence was higher as thoughts have the US and Canadian spring wheat crops continuing to deteriorate. The strength in Mpls had both the Chgo and KC markets trading higher but with only half of the advance. As long as it appears the spring wheat crops are suffering the bias will be for higher prices. Last Tuesday the talk was that the US wheat markets were overbought. That scenario has been alleviated. It’s my thought last week’s highs are in line to be tested if not taken out in the coming days.
The advertised interior wheat basis levels continue to be relatively quiet. I’m told we did see a decent amount of HRW and SRW move on the rally. The export market for HRW has noticeably tapered off. SRW at the Gulf never saw much movement. KC and Chgo wheat spreads continue to be wide as the flat price rally has taken US wheat off of the export table.
I fully expect to see last week’s highs tested over the next day or so. Will the USDA report be a game changer? I doubt the US data will be but with the World data one never knows.
Daily Support & Resistance for 07/11
Sept Chgo Wheat: $5.37 – $5.75
Sept KC Wheat: $5.45 – $5.77 ($5.83)
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.