Wheat Commentary


Wheat – Just My Opinion

May Chgo Wheat closed ¼ cent lower ($6.52 ¼), July 1 ¼ cents lower ($6.53 ¾), & Sept ½ cent lower ($6.56 ¼)

May KC Wheat closed 2 ¾ cents higher ($6.12), July closed 2 ½ cents higher ($6.18 ¾) & July 2 ½ cents higher ($6.25)

May Mpls Wheat closed ¼ cent higher ($6.64 ½), July ¼ cent higher ($6.71 ½) & Sept unchanged ($6.76 ½)

Weekly Wheat Export Inspections – 613.5 K T. vs. 250-550 K T. expected

Wheat futures started Sunday strong with the rest of the Ag crowd but as the session went on futures fell victim to the short side of inter-market spreads. The recent weakness in the US Dollar appeared to be its only supporting issue. There is a cold snap called for in the central southern Plains over the next couple of nights but it doesn’t appear to be as cold as some were thinking late last week. The northern Plains remain historically dry but the most recent forecasts are trying to suggest some light moisture may leak in by month’s end. Yes, weekly export inspections came in better than expected but realize this is old news for the old crop. Focus has moved to the new crop.

Interior cash wheat markets don’t do much. The HRW basis at the Gulf remains fully steady while bids for SRW are weakening. KC spreads ran fractionally firmer on the day while Chgo spreads were mostly mixed; May gains a bit on July while July loses to Sept.

If I didn’t know better recent buyers of wheat futures are taking a step back with a wait and see attitude. What they are waiting to see is how recent weather forecasts play out. Today’s high in July Chgo ($6.63) should be viewed as decent resistance while the same can be said for today’s high ($6.26) in the July KC market.

The USDA reports the US winter wheat condition ran unchanged across the board; 53% GE, 30% Fair, & 17% P-VP (just as the trade was expecting). Spring wheat planting was reported at 19%; 2% better vs. trade expectations and 7% better vs. the 5-year average. The most notable advance was in the state of Washington; 71% planted vs. the norm of 45%.

Daily Support & Resistance – 04/20

July Chgo Wheat: $6.45 ($6.40) – $6.61

July KC Wheat: $6.10 ($6.04) – $6.24

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.