Wheat Commentary


Wheat – Just My Opinion

July Chgo Wheat expired unchanged ($5.24 ¾), Sept closed 2 cents higher ($5.26 ¾) & Dec 1 ½ cents higher ($5.32 ¾)

July KC Wheat expired 2 ¼ cents lower (4.38 ¼), Sept closed 6 ¾ cents lower ($4.42 ¼) & Dec 6 ½ cents lower ($4.54 ¼)

July Mpls Wheat expired ¼ cent lower ($5.10), Sept closed unchanged ($5.18 ¾) & Dec ½ cent lower ($5.31 ½)

Overnight Egypt buys 114 K T. Russian wheat – paid $211.90 FOB, $226.75 C&F – The C&F price paid is $7.90 higher vs. last week’s purchases

The divide among the US wheat futures’ varieties continues. The bulls are favoring the Chgo market while the bears are favoring the KC market and Mpls is caught in the middle. It is my thought the Chgo market is favoring the higher global prices while KC is favoring the not so special US export market. As much as the KC/Chgo spread appears over done KC trading $1.00 below Chgo does not seem to be out of the realm of possibility.

The advertised interior basis for SRW continues to show a firm bias and the interior HRW shows a soft bias. The Gulf for HRW appears soft while the Gulf for SRW is fully steady. Chgo intra-market spreads ran steady to fractionally tighter while the KC intra-market spreads just the opposite.

Flat price Chgo consolidates just below recent highs. $5.40 on up represents resistance while its best looking support is still down towards the $5.00 level. Price action below the $5.20 level looks like it could attract some selling. The KC market is just starting to test the suspected support starting at the $4.40 level. It seems like Chgo’s best support is coming from inter-market spreads; Chgo wheat vs. corn, soybeans and KC wheat.

Daily Support & Resistance – 7/15

Sept Chgo Wheat: $5.15 – $5.35

Sept KC Wheat: $4.35 – $4.50

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.