Wheat Commentary


Wheat – Just My Opinion

Sept Chgo Wheat closed 2 ½ cents lower ($4.69 ¾), Dec 2 ½ cents lower ($4.72 ¾) & March 2 ½ cents lower ($4.78 ¼)

Sept KC Wheat closed 5 cents lower ($3.87 ¼), Dec 2 ¾ cents lower ($4.01 ½) & March 2 ¼ cents lower ($4.16 ½)

Sept Mpls Wheat closed 8 cents lower ($4.79 ½), Dec 4 cents lower ($5.01 ½) & March 3 ¾ cents lower ($5.16 ¼)

Weekly Wheat Export Sales – 661.7 K T. old crop vs. 250-700 K T. expected – no new crop vs. none expected

Flat price wheat continues to struggle when trying to sustain a rally. Delivery fears dominated the KC and Mpls market. It is thought Chgo deliveries will be slight but earlier this week there was a rumor that maybe some HRW would be delivered. The problem with the wheat market is simple – too much global supply and all of the major exporters are vying for market share. History tells us that this is a bearish scenario.

Advertised basis levels for standard protein wheat continue to run unchanged. This holds true for export basis as well. Chgo spreads ran flat on the day while both KC and Mpls spreads had a notable bearish bias. The spread action in both KC and Mpls are advertising the possibility of big deliveries.

The trend in Chgo is a short term sideways and a long term lower. The short term trend in KC is sideways as the Dec contract has traded in a 10-12 cents range dating back to August 14th. The longer term trend is still definitely lower. I’m not sure what else to tell you given the global glut of wheat and the less than advantageous share the US has.

Daily Support & Resistance for 08/30

Dec Chgo Wheat: $4.68 – $4.80

Dec KC Wheat: $3.97 (?) – $4.09

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