Wheat Commentary


Wheat – Just My Opinion

May Chgo Wheat closed 12 ½ cents higher ($6.28 ¾), July 14 ½ cents higher ($6.30 ½) & Sept 13 ¾ cents higher ($6.32)

May KC Wheat closed 13 ¼ cents higher ($5.76 ½), July 13 ¾ cents higher ($5.83 ¾) & Sept 13 ½ cents higher ($5.90 ½)

May Mpls Wheat closed 15 ¾ cents higher ($6.40 ¼), July 15 ½ cents higher ($6.47 ½) & Sept 15 cents higher ($6.54 ¾)

Weekly Wheat Export Sales – 82.0 K T. old crop vs. 100-500 K T. expected – 529.9 K T. new crop vs. 50-200 K T. expected

Noticeably better than expected new crop wheat export sales and continued dryness in the spring wheat areas with little relief in sight has wheat futures continuing to follow through from Wednesday’s rally led by the Mpls market. It should be noted that the better than expected weekly new crop wheat sales were led by China. This has the trade thinking more may be on the way.

The interior cash market for SRW reads mostly steady while the Gulf basis is seeing a slight bump higher. May wheat continues to languish on the spread despite the higher flat price. I have to think a good portion of this weakness is due to the index fund roll. The interior HRW basis is steady with what looks like a firm undertone. The HRW rail basis to the gulf is showing slightly better numbers. KC spreads run fractionally mixed.

The recent rally has nothing to do with the what the trade is expecting to see from the USDA tomorrow. The US carryout is expected to rise by about 10 M bu. and the World carryout is expected to rise about 400 K T. If the report is deemed bearish expect to see some of the recent gains given back but I have to think the Mpls market should continue to stay firm vs. the Chgo market just because of the current weather issues at hand.

Daily Support & Resistance – 04/09

July Chgo Wheat : $6.10 – $6.28

July KC Wheat: $5.66 – $5.82

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.