Wheat Commentary


Wheat – Just My Opinion

March Chgo Wheat closed 4 cents lower ($6.34 ¾), May 4 cents lower ($6.36 ¾) & July 3 cents lower ($6.28 ¾)

March KC Wheat closed ¾ cent lower ($5.94), May ¾ cent lower ($5.98 ½) & July ¾ cent lower ($6.01 ¾)

March Mpls Wheat closed 1 ¾ cents lower ($6.06), May 1 ¾ cents lower ($6.14 ½) & July 1 ¾ cents lower ($6.17 ¾)

Weekly Wheat Export Inspections – 279.3 K T. vs. 250-450 K T. expected

Egypt announces an overnight tender for optional origin wheat

US wheat futures continue to be a crowd follower. The bearish news of the day was continued poor US disappearance as evidenced by the feeble looking weekly export inspections. A noticeable bounce in the US Dollar Index was a bearish influence. World news involving wheat was mostly bullish. Russia is contemplating an increase in its export tax; from 25 Euros per T. to 50 Euros per T. Various countries have announced tenders totaling nearly 1.0 M T. over the next few days. I find it interesting that Egypt announced an overnight tender with not much correction in the flat price. I have to think they are scared to death of much higher prices over the next few months.

Interior cash wheat prices don’t do much while maintaining a firm under tone. The same can be said about Gulf values. Chgo spreads ease in response to the flat price selling while KC were flat along with its flat price.

For the past few days flat price wheat charts have moved into a minor corrective phase after registering new contract highs in both Chgo and KC as recently as last Tuesday. I’m seeing a fair amount of technical support at levels not far from the lows we saw today. Not much is expected from the USDA tomorrow but then again this market has been a crowd follower and will probably continue to do so tomorrow. .

Daily Support & Resistance – 01/12

March Chgo Wheat : $6.20 – $6.60

March KC Wheat: $5.80 – $6.16

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.