December Chgo Wheat closed 10 ½ cents higher ($7.78 ½), March 9 cents higher ($7.90 ¼) & May 8 ¼ cents higher ($7.94)
December KC Wheat closed 12 ¾ cents higher ($7.93 ½), March 13 cents higher ($7.98) & May 12 ½ cents higher ($7.98 ¾)
December Mpls Wheat closed 15 cents higher ($10.23 ¾), March 16 ½ cents higher ($10.13 ¼) & May 16 ¼ cents higher ($9.93 ¾)
US – USDA lowered imports 10 M bu., lowered food use 2 M bu., increased seed use 4 M bu., cut exports 15 M bu., increased carryout 3 M bu. – STU – 28.81% vs. 28.48% last month vs, 40.02% year ago
World – USDA lowered carryin 410 K T., lowered production 590 K T., increased usage 370 K T., lowered carryout 1.38 M T.
As expected the USDA supply-demand report had minimal changes. For me it just acted as a reminder that the US and World wheat situations remain tight. With that said the Mpls market regained its leadership role followed by the KC market and Chgo bringing up the rear. Going forward its going to be all about demand. It would be nice to see some business shift to the US but the USDA suggested that’s not going to happen anytime soon. With that said US wheat prices will continue to take their lead from overseas prices.
Interior basis levels for standard protein are quiet as the recent break has shut off any new cash movement. Export levels, however, continue to maintain their recent firm tone. Chgo spreads tightened up with today’s buying. KC spreads run mixed with a slight bias favoring the old crop. The nearby Mpls still appears to be liquidating.
As I mentioned going forward US wheat futures will take their lead from overseas prices. In two weeks, if not sooner, we should start seeing some fun and games tied to first notice day. If first notice day was tomorrow I would say no Mpls or KC deliveries and clueless to Chgo. I remain a big fan of higher prices down the road. I won’t chase rallies but focus on breaks to what I suspect is support. I was ready for some support testing today but the market said, “not today”.
Daily Support & Resistance – 11/10
Dec Chgo Wheat: $7.70 – $7.95
Dec KC Wheat: $7.84 – $8.10
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