Wheat Commentary

storck

Wheat – Just My Opinion

Dec Chgo Wheat closed 2 ¼ cents lower ($6.29 ¾), March ¾ cent lower ($6.31 ¼), & July 2 ½ cents higher ($6.21)

Dec KC Wheat closed 1 ¼ cents lower ($5.69 ¾), March 1 cent lower ($5.77) & July 1 ¼ cents lower ($5.86 ¼)

Dec Mpls Wheat closed 4 ¾ cents higher ($5.82 ½), March 3 ¼ cents higher ($5.91 ¼) & July 1 ¼ cents higher ($5.99 ¾)

Weekly Wheat Export Sales – old crop vs. 200-800 K T. expected – new crop vs. none expected

Rain is in the forecasts (6-10 day) for Kansas and Oklahoma. Not so much for the dry areas of Russia’s winter wheat areas. Recent rain in Argentina has at least stabilized their wheat crop. I do think these forecasts took the wind out of the bulls’ sales at least for the near term. Chgo failed to rally beyond yesterday’s highs while KC made new highs for its rally but did close slightly lower. I think the higher Mpls market was just playing some catch-up as it appears almost historically cheap vs. the Chgo and KC markets.

US cash wheat markets remain quiet. The rally has not been about demand for US wheat. US wheat has been following the higher World prices. Spreads in Chgo soften following their recent inversion. Spreads in Chgo are so dictated by the push-pull of the daily fund flat price activity.

Maybe it’s my imagination but the rally in wheat is starting to look a bit tired. Recent intra-day break in the flat price have been well received – today not so much. I was expecting a better performance given the recent wave lower in the US Dollar. Like all of our Ag markets they have room to correct lower without denting the uptrend. Maybe I’m wrong but I’m thinking patience is the key here before instituting any new long positions.

Daily Support & Resistance – 10/22

Dec Chgo Wheat: $6.20 – $6.40

Dec KC Wheat: $5.60 – $5.81

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