March Chgo Wheat closed 7 ½ cents lower ($5.62 ¼), May 7 ¼ cents lower ($5.61 ¼) & July 6 ¾ cents lower ($5.60 ½)
March KC Wheat closed 10 cents lower ($4.72), May 9 ¾ cents lower ($4.79 ½) & July 9 ¾ cents lower ($4.87)
March Mpls Wheat closed 6 ½ cents lower ($5.35 ¾), May 6 ¼ cents lower ($5.45 ¼) & July 6 cents lower ($5.53 ¾)
Weekly Wheat Export Sales – old crop vs. 300-700 K T. expected – new crop vs. 0-50 K T. expected
Flat price wheat continues with its recent downside correction mode. European markets remain firm due to the ongoing French port strikes as it has shifted demand to other European ports. The Black Sea cash market looks steady whereas the Black Sea futures’ market is seeing some selling. Recent statements suggesting China has bought Australian, French and Canadian wheat in recent weeks just goes to show how high priced US origin is vs. the competition. I find it ironic that on Monday afternoon the USDA touted the need for moisture in the Southern Plains winter wheat areas only to see a fairly sizable snowstorm develop within hours of that report in the touted areas. The quality issues around the SRW stocks continue to lend support to the Chgo spreads despite the flat price correction.
Advertised interior wheat basis levels run steady on the day but continue to show a relatively firm undertone. This holds true for the export market as well. Overall Chgo spreads continue to hold firm. The issue with SRW quality should work to keep Chgo spreads well supported even though we may see some minor corrections from time to time. KC spreads continue to go nowhere fast.
For the time being $5.55-$5.60 should prove to be support for March Chgo Wheat. The same can be said for the $4.65-$4.70 level for March KC wheat. Because I believe flat price wheat is in a near term corrective phase attempts to rally should remain somewhat limited. In other words I believe a top is in place for now.
Daily Support & Resistance for Jan 30th
March Chgo Wheat: $5.59 – $5.70
March KC Wheat: $4.69 – $4.81
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.