Wheat Commentary


Wheat – Just My Opinion

December Chgo Wheat closed 1 ¼ cents lower ($5.07 ¾), March 2 ¾ cents lower ($5.11) & July 3 cents lower ($5.19 ½)

December KC Wheat closed 2 ½ cents lower ($4.22 ¼), March 2 ½ cents lower ($4.30 ¾) & July 1 ½ cents lower ($4.45)

December Mpls Wheat closed 2 ½ cents lower ($5.12 ¾), March 2 ¼ cents lower ($5.27 ¾) & July 2 cents lower ($5.47 ½)

Overnight Egypt buys 465.0 K T. of wheat – 120 K T. Ukraine – 345 K T. Russian – average price paid right around $232.30 (C&F) vs. $233.12 on Nov 4th

Weekly Wheat Export Sales – old crop vs. 200-500 K T. expected – new crop vs. none expected

Egypt buys a pretty big chunk of wheat yet US prices were easing. It is my thought the easing of the US futures is that Egypt paid less today vs. their two previous purchases. Yes, US wheat offerings remain absent in the Egyptian tenders. If our primary competitors’ prices are coming down there is no reason why US prices should rally. Weekly wheat export sales are out in the morning; trade guesstimates continue to suggest the US is still a secondary market in the world’s export circles.

Advertised cash prices (basis) show no change from previous postings. This holds true for the Gulf basis as well. Chgo spreads have a firm bias due to the ongoing quality issues. KC spreads are steady upfront but lose to the deferreds. Will HRW be needed to satisfy CBOT delivery obligations as they did back in September? I’m not sure the availability is there anymore.

$5.00 is still perceived as good interim support for Dec Chgo wheat; the mid-$5.20’s is the interim resistance. the mid-$4.10’s looks like decent interim support for Dec KC wheat while is interim resistance looks like the mid-low $4.30’s. As of this writing I don’t see a major sustainable move in either direction.

Daily Support & Resistance for 11/15

Dec Chgo Wheat: $5.01 – $5.15

Dec KC Wheat: $4.16 – $4.30

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.