Wheat Commentary


Wheat – Just My Opinion

July Chgo Wheat closed 30 cents higher ($6.93 ½), Sept 30 cents higher ($6.97 ¼) & Dec 28 ½ cents higher ($7.03 ¼)

July KC Wheat closed 24 ¼ cents higher ($6.37 ½), Sept 24 ½ cents higher ($6.45) & Dec 24 cents higher ($6.56 ¼)

July Mpls Wheat closed 44 cents higher ($7.71 ½), Sept 42 cents higher ($7.75 ½) & Dec 39 ¾ cents higher ($7.77 ¼)

Weekly Wheat Export Inspections – 256.5 K T. vs. 250-625 K T. expected

Spring wheat, the Mpls contract, was the Ag upside leader on Tuesday. The near triple digit heat that is being forecasted for the Dakotas later this week was the driver. The spring wheat crop is already in question; both yield and acreage due to the area’s ongoing dryness. The KC contract, HRW, was the least firm of the varieties. There remains some questions to its crop size/quality due to recent excessive moisture. Despite this the HRW is still expected to show some of the best yields in years. The Chgo contract gets caught in the middle of the KC and Mpls contract. Remember that the Chgo contract gets the lion’s share of the speculator interest.

The trade is expecting to see the spring wheat crop rated at 45% GE (unch). The USDA reports the spring wheat crop is now rated 43% GE (-2%). The expected rating for the winter wheat crop is 48% GE (+1%). The USDA reports the winter wheat crop is now rated 48% (+1%).

July Chgo wheat still has a way to go before it challenges the resistance ($7.20+) made in early May. The same holds true for the July KC contract as it needs to get closer to the $6.90 level before significant resistance is challenged. Weather considerations in the Dakotas will continue to be the driving force with both Chgo and KC playing second fiddle to the Mpls contract.

Daily Support & Resistance – 06/02

July Chgo Wheat: $6.80 – $7.18

July KC Wheat: $6.25 – $6.50 ($6.60)

 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.