Wheat Commentary


Wheat – Just My Opinion

Sept Chgo Wheat closed unchanged ($4.87 ¼), Dec ¾ cent lower ($4.98 ¼) & March ¾ cent lower ($5.10 ¾)

Sept KC Wheat closed 2 ¼ cents higher ($4.31 ½), Dec ¾ cent higher ($4.49 ¼) & March ½ cent lower ($4.67 ¼)

Sept Mpls Wheat closed ¾ cent lower ($5.20 ½), Dec unchanged ($5.35) & March unchanged ($5.50)

Overnight Egypt buys 300 K T. wheat – 120 K T. Romanian, 60 K T. Russian and 120 K T. Ukraine – Average price paid $219.34 T. vs. last week paid $215.54 T.

It was a two-sided trade for wheat futures Monday night, Tuesday; ending mixed among the varieties. Monday night saw higher prices stemming from the announced Egyptian tender. Once it was realized that US wheat was not offered prices broke down to new lows for the current move. As the day progressed prices were able to recover on the coattails of the corn market as well from the higher prices Egypt paid vs. what they paid last week. Later in the day it was reported that the Wheat Quality Council tour was finding above average spring wheat yields in south central N. Dakota.

Despite what appears as an easing interior basis and Gulf basis nearby spreads in both Chgo and KC had a bullish bias; mostly in KC. I believe this is a result of no delivery registrations. I have to believe this can change over the next month or so. Shipment demand for US wheat has been decent but it has to be reminded that we are still not competitive in the World’s export circles. High freight rates continue to be the culprit.

Today’s price action may suggest the recent selling may be running out of steam. The “however” is that I still don’t see the price action that suggests solid looking support is developing. My thought is that wheat is still a follower of corn and with that said it will continue to follow but to a much lesser extent.

Daily Support & Resistance for 07/24

Sept Chgo Wheat: $4.83 ($4.80) – $4.97

Sept KC Wheat: $4.25 (?) – $4.40

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.