Wheat Commentary

storck

Wheat – Just My Opinion

Dec Chgo Wheat closed 5 cents higher ($6.32), March 6 cents higher ($6.32) & July 7 ¾ cents higher ($6.18 ½)

Dec KC Wheat closed 8 cents higher ($5.71), March 8 cents higher ($5.78) & July 8 ½ cents higher ($5.87 ½)

Dec Mpls Wheat closed 8 ½ cents higher ($5.77 ¾), March 7 cents higher ($5.88) & July 7 cents higher ($5.98 ½)

US wheat futures stay firm with the ongoing dryness in the HRW areas of the US as well as in Russia. Personally I’m not seeing a lot of moisture for these areas. After a relatively volatile session; higher to start then lower and then back higher, the hard varieties took over the leadership role. World wheat prices continue to be firm as it seems importers are being forced to come to the market in the wake of these higher prices. Once would think the weak US Dollar would attract some business our way but so far I’m not seeing it as basis levels here in the US are not changing. This holds true for both domestic and for export. Transportation out of the US continues to be a major stumbling block. The bottom line to all of this is that major importers are currently being threatened with the idea that new crop prices could be appreciably higher vs. what we are seeing now.

The past couple of days of price activity has seen early bulges follow by sell offs but then prices come marching right back up. This suggests the funds are continuing to amass net long positions. This activity is not bearish. As long as the world is fearful of a short new crop prices will remain biased to move higher. Based on the attempt to correct a week and a half ago Dec Chgo futures are targeting something just shy of the $6.50 level and Dec KC targeting something just above the $5.80 level.

Daily Support & Resistance – 10/21

Dec Chgo Wheat: $6.25 – $6.42

Dec KC Wheat: $5.65 – $5.81

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.