May Chgo Wheat closed 18 ½ cents higher ($5.80), July 12 ½ cents higher ($5.67 ¾) & Sept 10 cents higher ($5.66 ½)
May KC Wheat closed 10 ¼ cents higher ($5.01), July 9 ½ cents higher ($5.04 ¾) & Sept 8 cents higher ($5.10 ¼)
May Mpls Wheat closed 2 ½ cents higher ($5.37 ½), July 2 ¾ cents higher ($5.46 ¼) & Sept 3 ½ cents higher ($5.54 ½)
Weekly Wheat Export Sales – old crop vs. 200-500 K T. expected – new crop vs. 150-450 K T. expected
The push higher for quality milling wheat continues. I’m not sure just how business is getting done but it is becoming evident that the buyers are not getting what they want bought. My guess is the best buying is coming from the managed sector. I’m calling “herd mentality”. I do see a fair amount of global business happening but as I said its questionable as to how much business the US is getting. In recent days we’ve talked about individual hoarding – now I’m hearing about countries hoarding at least securing enough supply for their own citizenry.
Advertised basis levels for standard protein wheat run unchanged. This holds true in the interior as well as for export. Bull spreads move sharply higher in Chgo. Not only is there a push for quality milling wheat the lack of SRW quality further aggravates the situation. KC spreads improve but nowhere near the extent seen in Chgo. In Mpls spreads actually lost some ground.
So- have Chgo wheat prices gone high enough for the near term? Since March 16th May Chgo wheat has rallied just over 90 cents, July just shy of 80 cents. May KC wheat has rallied 85 cents in the same time frame while the July KC contract has rallied just over 80 cents.
I understand a good portion of the rally has been fear based. Given the dramatic rises in such a short period of time I have to say the rally is a bit overdone. Poor weekly export sales in the morning could be a rally breaker.
Daily Support & Resistance – 3/26
July Chgo Wheat – $5.50 – $5.75
July KC Wheat – $4.85 – $5.12
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