Wheat Commentary


Wheat – Just My Opinion

Dec Chgo Wheat closed 4 ½ cents higher ($5.98), March 2 ¾ cents higher ($6.04 ¾), & July 4 ¼ cents higher ($6.06 ½)

Dec KC Wheat closed 6 cents higher ($5.58), March 6 ¼ cents higher ($5.66 ¾) & July 5 ¾ cents higher ($5.76 ½)

Dec Mpls Wheat closed ¼ cent lower ($5.54 ½), March unchanged ($5.69 ¾) & July 1 ½ cents higher ($5.85)

Weekly Wheat Export Inspections – 325.9 K T. vs. 275-600 K T. expected

Weekly Winter Wheat Condition & Progress – 46% GE (+1%) vs. 46% expected vs. 52% year ago – Planted – 96% vs. 97% expected vs. 94% 5-year average – Emerged – 85% vs. 84% 5-year average

US wheat futures continue to mirror the goings on in the rest of the Ag complex. The Sunday night trade was two-sided as was the start to the day session. When the other Ag commodities went firm as the day session unfolded so did wheat futures. News of note has Russia reporting its winter wheat conditions are not very good. That is already a “known” when it comes to the US winter wheat condition.

The latest Commitment of Traders report suggests that large speculators cut their net long position by 14,700 contracts while the manage sector cut their net long position by 15,972. Once again this is a bit confusing as March wheat gained 6 cents during this reporting period. Open interest, however, declined by 13 K during the reporting period.

Interior cash wheat prices (basis) remain quiet. The export basis for HRW has been easing in recent days while just the opposite has been happening for the SRW export basis. Spreads in KC don’t do much; mixed at best. Spreads in Chgo read even more mixed as Dec gains on March while March loses goring forward.

Last week I talked about wheat charts looking susceptible to further breaks yet at the same time I voiced mistrust about chasing the break. If I didn’t know better wheat prices are ready to move into a trading range affair. Daily influences will be the direction of the US Dollar and whatever the rest of the Ag sector is doing. MY best MO for trading this market is to fade short term inter-day extremes such as we saw early last Friday when Dec wheat challenged the $5.80 level.

Daily Support & Resistance – 11/17

March Chgo Wheat: $5.95 – $6.15

March KC Wheat: $5.56 – $5.75

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.