Wheat Commentary


Wheat – Just My Opinion

Sept Chgo Wheat closed 2 cents lower ($5.05 ½), Dec 2 cents lower ($5.17 ¼) & March 1 ¾ cents lower ($5.29 ¾)

Sept KC Wheat closed 4 ½ cents lower ($4.41 ¾), Dec 4 cents lower ($4.62 ¼) & March 4 ¼ cents lower ($4.81 ¾)

Sept Mpls Wheat closed 2 ½ cents lower ($5.27 ¾), Dec 2 ¾ cents lower ($5.40 ¾) & March 2 ½ cents lower ($5.55 ½)

Egypt announces an overnight tender for optional origin wheat – overnight Egypt buys 60.0 K T. Russian wheat –

Weekly Wheat Export Sales – old crop vs. 200-400 K T. expected – new crop vs. none expected

A total of 765 K T. of wheat was offered to Egypt and not a pound of it was US origin. That pretty much tells it all as to today’s trade. Harvest is happening around the World (Northern Hemisphere) and it looks like production data from our export competitors will be larger vs. last year despite some cuts from previous ideas. Without export demand the best the US wheat market can do is be a follower of other feed grains. Yes, I’ve heard of improved wheat feeding in the southwest but rarely is a market made from domestic demand unless we’re running with a great shortfall which we are not.

Advertised basis levels for standard protein wheat runs unchanged vs. Tuesday’s postings. If I had to suggest a trend its steady to a shade easier for SRW and mostly steady for HRW. SRW basis along the Ohio River has been in an easing mode for the past few days. HRW at the Gulf reads steady with a very slight friendly bias while the SRW continues to be a non-event at the Gulf. Chgo spreads within the current crop year ran fractionally mixed on the day while gaining slightly on the 2020/21 crop year. Not much happens with the KC spreads.

Last week’s low in Sept Chgo wheat was $4.98; take that out and it suggests something closer to $4.90. Failure at $4.90 suggests $4.80. The measurement from last week’s low to Monday’s high is $4.70 if $4.98 is taken out (with conviction) on a closing basis. Just a word of caution – wheat futures are notorious for “head fakes”. Be careful when considering chasing an inter-day extreme.

Daily Support & Resistance for 07/18

Sept Chgo Wheat: $4.98 (?) – $5.15

Sept KC Wheat: $4.35 ($4.30) – $4.52

 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.