Wheat Commentary


Wheat – Just My Opinion

March Chgo Wheat closed 4 ¾ cents higher ($5.73 ¼), May 3 ¾ cents higher ($5.74) & July 3 cents higher ($5.74 ¾)

March KC Wheat closed ½ cent lower ($4.96 ½), May ½ cent lower ($5.04) & July ¾ cent lower ($5.11 ½)

March Mpls Wheat closed ¼ cent higher ($5.56 ¼), May ½ cent lower ($5.63 ¾) & July ½ cent lower ($5.70 ½)

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

Chgo wheat goes it alone on Wednesday. I don’t today’s strength had anything to do with the trade accord signing (history suggests that if China buys US wheat it will favor HRS) but rather what the wheat market has been trading on in recent days; overall strength in the World market coupled with the tightness for quality SRW. If the hard varieties continue to lag Chgo I have to think they will eventually weigh on Chgo’s flat price. The nearby bull spread in Chgo should continue to work as it has to reflect the scarcity of quality SRW.

The advertised basis levels for standard protein wheat continue to see no new changes. This holds true for both interior and export. Bull spreads in Chgo work like gangbusters especially the old crop/new crop. KC spreads remain relatively flat looking.

Yesterday I talked about flat price KC losing some of its “get up and go”. I still have that thought today given today’s new high for the current rally followed by the fractionally lower close. I’m beginning to wonder if Chgo is moving into a world of its own. If the inter-market wheat spreads get out of whack enough Chgo will come back to earth. For the past month or so Chgo wheat has been in a well-defined up-channel – today’s highs tapped at the resistance line of that channel.

Daily Support & Resistance for Jan 16th   

March Chgo Wheat: $5.66 ($5.61) – $5.76 ½  

March KC Wheat: $4.90 ($4.85) – $5.01

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