Wheat Commentary


Wheat – Just My Opinion

Sept Chgo Wheat closed 14 ¼ cents higher ($4.74 ½) Dec 10 ¾ cents higher ($4.74 ½) & March 8 ½ cents higher ($4.79)

Sept KC Wheat closed 4 ¾ cents higher ($3.80), Dec 4 ¾ cents higher ($3.98) & March 4 cents higher ($4.12)

Sept Mpls Wheat closed 2 ½ cents higher ($4.77 ¼), Dec 2 ½ cents higher ($4.96 ¾) & March 2 ½ cents higher ($5.11 ½)

Weekly Wheat Export Inspections – 402.4 K T. vs. 400-650 K T. expected

Weekly Spring Wheat Crop Progress – Harvested – 71% vs. 69% expected vs. 87% 5-year average

The Chgo market leads all US wheat futures higher on Monday. Dryness in Argentina, Australia lowering its wheat crop by 2.0 M T. and Saudi Arabia buying 780 K T. optional origin wheat over the weekend all worked together to buoy prices higher on Monday. Adding to some of the strength are concerns over the balance of the spring wheat crop yet to be harvested due to wet conditions. Last but not least the bull spreading in Chgo was hard to ignore. Quality SRW stocks are hard to originate without blending in some HRW.

Toledo lowers its SRW basis 3 cents. I’m told they might be blending some of their SRW stocks with some HRW to get a better quality. Basis elsewhere for both SRW and HRW run unchanged. Bull spreads work big time in Chgo and just modestly in KC.

Last week flat price wheat found support against the downside of the channel that has been working lower since June. If history repeats itself price will now move sideways to higher and challenge the resistance of the current down channel. As we move into Thursday’s Supply/Demand update (wheat production updates will not occur until month end) we will be reminded that the World is currently flush with wheat. Thursday’s data could easily top out the current attempt to rally.

Daily Support & Resistance for 09/10

Dec Chgo Wheat: $4.65 – $4.82

Dec KC Wheat: $3.90 – $4.07

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.