Wheat Commentary


Wheat – Just My Opinion

Sept Chgo Wheat closed 10 cents lower ($4.87 ¼), Dec 9 ¾ cents lower ($4.93 ¼) & March 8 ¼ cents lower ($5.04 ¼)

Sept KC Wheat closed 10 ¾ cents lower ($4.22 ¾), Dec 10 ½ cents lower ($4.40 ½) & March 10 ¼ cents lower ($4.57 ¼)

Sept Mpls Wheat closed 9 ¼ cents lower ($5.19 ½), Dec 7 ¼ cents lower ($5.33 ¼) & March 6 ½ cents lower ($5.47 ¾)

Weekly Wheat Export Sales – old crop vs. 300-600 K T. expected – new crop vs. none expected

US wheat futures continue to be a follower of the corn market. New news involving the wheat market was hard to find. The strength of the US Dollar continues to keep US origin uncompetitive in the World export circles. Technical selling was noted in Chgo when prices took out Monday’s lows. The same technical considerations are holding true for the KC market as well. We continue to hear wheat crops around the world getting shaved from previous production ideas but the bottomline is still crop sizes are larger vs. year ago levels.

The Ohio River is jumping its basis for SRW. SRW basis elsewhere is running unchanged for standard protein. I still hear of better bids for higher protein. Despite the flat price getting whacked spreads did not lose as much as one might expect. The Gulf basis for SRW remains quiet while the HRW market continues to show a firm tone.

The recent interim low for Sept Chgo is $4.83. Failure there would suggest something closer to $4.75. Like the rest of the Ag sector short term technical considerations are reading with a fair degree of oversold after today’s activity. Daily technical data does not read oversold at all. It remains my thought that once the current liquidation run is over wheat prices will move into a sideways mode. I am not anticipating any major move back to the upside.

Daily Support & Resistance for 08/01

Sept Chgo Wheat: $4.83 ($4.76) – $4.95

Sept KC Wheat: $4.17 – $4.29

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.