Sept Chgo Wheat expired 10 ½ cents higher ($6.85), Dec closed 13 ¾ cents higher ($7.00 ¾) & March 14 ¼ cents higher ($7.11 ¼)
Sept KC Wheat expired 8 ¼ cents higher ($6.86 ½), Dec closed 15 ½ cents higher ($7.01 ¾) & March 15 ½ cents higher ($7.10 ½)
Sept Mpls Wheat expired 12 ¼ cents higher ($8.93 ½), Dec closed 11 ¼ cents higher ($8.87 ¼) & March 9 ¾ cents higher ($8.76 ¼)
Canadian wheat production is lowered by 1.23 M T. (a decrease of 1.0 M T. had been expected) according to the latest from Statistics Canada. France lowers its soft wheat production by 600 K T. (French Farm Ministry). These two items were probably most responsible for the wheat futures’ rally today. I find it interesting that last week we saw some concerted buying from the international sector in the cash market while futures were breaking down. This tells me the big importers realize the tight scenario the world will be saddled with until next year’s new crop becomes available.
As we move forward my worst case scenario for wheat futures is consolidation against recent lows. The 2-day rally has the flat price challenging some recently established resistance which suggests I don’t have to chase the current 30 cent KC rally. Watch your short term technical indicators for signs of testing support as the daily technical data is trying to suggest we may be looking at the beginning of a new leg higher. It does need to be noted that KC is the upside leader for now as the Dec KC/Dec Chgo spread inverted today on a closing basis.
Daily Support & Resistance – 09/15
Dec Chgo Wheat: $6.90 – $7.10
Dec KC Wheat: $6.90 – $7.14
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.