Wheat Commentary

storck

Wheat – Just My Opinion

Dec Chgo Wheat closed 9 cents lower ($5.49), March 8 ¾ cents lower ($5.57) & July 7 ¼ cents lower ($5.60 ¾)

Dec KC Wheat closed 7 ½ cents lower ($4.84 ¼), March 7 ¾ cents lower ($4.95) & July 7 ¼ cents lower ($5.08 ½)

Dec Mpls Wheat closed 6 ¾ cents lower ($5.33), March 6 ¾ cents lower ($5.46) & July 4 ¾ cents lower ($5.62)

Weekly Wheat Export Sales – old crop vs. 250-600 K T. expected – new crop vs. none expected

A lack of market making business coupled with a strengthening US Dollar weighs on US wheat futures. Adding to the bearishness of a stronger US Dollar freight out of the US is so costly it adds to the lack of competitiveness. Granted we have weather concerns developing for the sowing of winter wheat not only in this country but overseas as well it has done little to provide support. Argentina is in the process of downgrading its crop while Australia still looks good with ideas of a sharp rebound in production.

Interior cash wheat markets remain quiet. I will suggest interior basis levels for the hard varieties are faring better vs. the SRW. The gulf for HRW is a touch firmer while nothing happens with the export basis for SRW. Chgo spreads widen fractionally from month to month while KC spreads are pretty steady. KC flat price continues to gain on Chgo despite the lower flat price.

Last Thursday, Friday we saw Chgo wheat prices rally near 40 cents. Since Monday we have given back 30 cents of the rally. The KC market saw a similar rally but has only given back 25 cents of its rally. One would think a break similar to what we saw today would catch some support.

Daily Support & Resistance – 9/24

Dec Chgo Wheat: $5.40 – $5.60 

Dec KC Wheat: $4.77 – $4.95

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.