Wheat Commentary


Wheat – Just My Opinion

Sept Chgo Wheat closed 5 ¼ cents lower ($8.00 ¾), Dec 4 ¾ cents lower ($8.17 ¾) & March 4 cents lower ($8.31 ½)

Sept KC Wheat closed 6 ½ cents lower ($8.82 ¾), Dec 7 ½ cents lower ($8.85) & March 8 ¾ cents lower ($8.87 ¼)

Sept Mpls Wheat closed 8 ¾ cents lower ($9.10 ¾), Dec 9 ½ cents lower ($9.22 ½) & March 9 ½ cents lower ($9.34)

Weekly Wheat Export Inspections – 373.2 K T. vs. 250-675 K T. expected

Weekly Winter Wheat ProgressHarvested – 90% vs. 88.5% expected vs. 94% 5-year ave

Weekly Spring Wheat Condition & Progress – 64% GE vs. 63% expected vs. % year ago – Harvested – 16% vs. 21% expected vs. 35% 5-year ave

Flat price wheat goes along with the rest of Ag sector as it sees sharply lower prices in the early going on Monday. At one point Sept Chgo wheat traded as much as 28 cents lower and Sept KC 31 cents lower. Prices were able to show an appreciable from its early lows but faltered at the unchanged level. It has to be noted that it was inter-market spread buying that gave wheat prices its intra-day bounce. On Friday the USDA suggested a better export program going forward. I’m not sure too many in the trade believe that. Russian prices continue to falter from a slow beginning to the new export season as well as a monster crop coming staring at them. Monday saw slightly better European prices from a lower Euro.

Interior cash wheat prices run steady for SRW and steady to slightly easier for HRW. The export markets for both remain quiet. Weekly wheat export inspections were not much to write home about as they favored the low end of expectations. Wheat spreads had a slight bearish bias in Chgo while KC spreads had a slight bullish bias.

I’m not sure I can say the wheat price action is nothing more than a broad trading affair but with the likelihood we’ve probably gone low enough for now. Two days in a row the trade has tried to beat on prices only to see them bonce back. I’m not seeing any buy signals other than the reluctance to stay down. Does that make a market bullish – NO. Seasonal do suggest a higher bias going forward. All I can be sure of right now is to not get caught selling breaks.

Daily Support & Resistance – 08/16

Sept Chgo: $7.85 – $8.20 (?)

Sept KC: $8.65 – $9.00 (?)

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