March Chgo Wheat closed 12 ¾ cents lower ($6.29 ¾), May 11 cents lower ($6.27 ¾) & July 7 ½ cents lower ($6.17)
March KC Wheat closed 8 ¾ cents lower ($5.88), May 8 ½ cents lower ($5.91) & July 7 ¾ cents lower ($5.92 ½)
March Mpls Wheat closed 8 ½ cents lower ($5.80), May 8 ¼ cents lower ($5.88 ½) & July 7 ½ cents lower ($5.94 ¾)
Weekly Wheat Export Inspections – 303.8 K T. vs. 300-500 K T. expected
Flat price wheat trades higher early Sunday night as it followed the crowd. The “however” is that this market was the first one to start sliding lower and wound up registering the worst losses for the day. SovEcon, a Russian Ag consultancy, is suggesting wheat exports out of Russia will decline by 4.5 M T. from earlier estimates of 40.8 M T. Earlier this month th USDA suggested exports out of Russia would total 41.0 M T. This item can be viewed of two ways; more wheat available to the global pipeline or the Russian export taxes and quotas will cut their potential market share and move that share elsewhere. Given today’s response to the news the trade is thinking more available supply to the global pipeline. Adding to the bearish tone is the possibility that the labor strike in Argentina will end sooner vs. later allowing their recently harvested wheat to move through their export channels. Once again demand for US wheat is not much better than minimal as evidenced by today’s weekly export inspections.
Interior cash wheat markets (basis) remain quiet. The Gulf market for US wheat is just as quiet. Wheat spreads showed a bearish bias especially in Chgo reflecting the flat price selling. KC spreads were only fractionally easier moth to month.
It’s almost too easy to say the party is over here (at least for the near term) given today’s price performance. That may be but I’ll continue to use a flexible approach to this market fading short term inter-day extremes for short term trading opportunities.
Daily Support & Resistance – 12/29
March Chgo Wheat : $6.05 – $6.26 (6.30)
March KC Wheat: $5.65 – $5.86
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.