Wheat Commentary

storck

Just My Opinion – Wheat

Wheat Commentary
Sept Chgo wheat closes 1 ¾ cents higher ($4.41), Dec ¾ cent higher ($4.67 ¾) and March ¾ cent lower ($4.88)
Sept KC Wheat closes 4½ cents lower ($4.36 ¾), Dec 5 cents lower ($4.64 ¼) and March 5 ¼ cents lower ($4.82)
Weekly Wheat Export Inspections – 511.5 K T. vs. 400-600 K T. expected
Weekly Winter Wheat Progress – 97% harvested vs. 97% expected vs. 96% 5-year average
Weekly Spring Wheat Crop Ratings & Progress – 33% GE (+1%) vs. 33% expected vs. 66% year ago – 40% harvested vs. 38% expected vs. 35% 5-year average
At one point relatively early in the Monday day session Mpls wheat was down nearly 36 cents. this had KC wheat down 12 cents and Chgo down 9 cents. Granted Mpls prices came back to finish only 4 cents lower spread unwinding supported the Chgo market. One has to realize it was just a short time ago Chgo wheat was the weak sister among the varieties. Over the last few days KC has lost almost 10 cents to Chgo. I think what supported wheat in general on Monday were the varying degrees of oversold. Not only have US wheat prices been taking it on the chin but so have our global competitors. Prior to Thursday’s report I had talked about a lower US crop and how much of it would be offset by a larger competitor crop.
Interior cash wheat prices were pretty quiet on Monday despite slow movement. Export prices, however, are moving higher reflecting that slower movement. Chgo spreads saw the most notable support. Sept KC did some gaining while Dec KC continues to languish on its respective spreads.
Given the price action we saw on Monday, down sharply early followed by finishing at or near the day’s highs, I would like think we have gone low enough for the near term. The lack of demand for US wheat coupled with the overall global supply suggests that after we see a possible short covering rally we’ll see prices flatten out and begin to move sideways similar to what we experienced for most of last year.
Daily Support & Resistance for 08/15
Dec Chgo Wheat: $4.61 – $4.80
Dec KC Wheat: $4.60 – $4.76

 

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