Wheat Commentary


Wheat – Just My Opinion

May Chgo Wheat closed 1 ½ cents lower ($5.55), July 2 cents lower ($5.55 ½) & Dec 1 ¼ cents lower ($5.66 ½)

May KC Wheat closed 2 cents higher ($4.94), July 1 ¾ cents higher ($5.00 ¾)& Dec 2 cents higher ($5.17 ½)

May Mpls Wheat closed 5 cents lower ($5.27 ½), July 2 ¾ cents lower ($5.39 ¼) & Dec 5 cents lower ($5.59 ¼)

USDA – Friday, April 10th – announces 165 K T. HRW sold to China (55 K T. old crop, 110 K T. new crop)

USDA – Monday, April 13th – announces 120 K T. HRW sold to unknown (60 K T. old crop, 60 K T. new crop)

Weekly Wheat Export Inspections – 608.7 K T. vs. 300-500 K T. expected

Egypt announces and overnight tender for optional origin wheat

Flat price wheat was firm all night long led by the KC market.  A combination of recent export sales, export inspections, cold weather in the Southern Plains and dry weather in the Black Sea region all worked together to support prices. Prices did dip during the day session but KC managed to finish on the plus side. There is another cold night being forecasted for the southern Plains. If damage does occur it should begin to show up in the next few days. This afternoon’s crop progress report is expected to show unchanged to slightly lower conditions for the US winter wheat crop. (USDA reports the nation’s winter wheat crop at 62% GE (unchanged)).

Advertised interior wheat basis levels for standard protein run unchanged. I am told there was some HRW that moved on the overnight, early morning rally. I see nothing happening with the export basis levels. Realize that recent sales announcements show 2 cargoes of old crop and 5 cargoes of new crop. Chgo spreads show May losing to July but then July loses to its forward contracts. KC spreads show May advancing fractionally on the July but then July loses to its forward contracts.

July Chgo registers a minor downside reversal after a half-hearted challenge of its late March highs. July KC comes within ¾’s of a cent of its late March highs and backs off but manages to finish higher.  So here we have Chgo registering a minor reversal and KC registering a possible double top. Going forward, because we are dealing with new crop, weather considerations in the US as well with our export competitors will hold sway.

Daily Support & Resistance – 4/14

July Chgo Wheat – $5.48 – $5.63

July KC Wheat – $4.92 – $5.10 (?)

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