Wheat Commentary


Wheat – Just My Opinion

Sept Chgo Wheat closed 5 ¼ cents lower ($4.65 ½), Dec 5 cents lower ($4.72 ½) & March 4 ½ cents lower ($4.79 ½)

Sept KC Wheat closed 3 cents lower ($3.91 ¼), Dec 2 ¾ cents lower ($4.06 ¾) & March 3 cents lower ($4.22 ½)

Sept Mpls Wheat closed ¾ cent lower ($5.05 ½), Dec 1 ½ cents lower ($5.17) & March 1 ¼ cents lower ($5.31 ¾)

Weekly Wheat Export Inspections – 488.9 K T. vs. 400-600 K T. expected

Weekly Winter Wheat Progress – Harvested – 93% vs. 94% expected vs. 98% 5-year average

Weekly Spring Wheat Condition & Progress – 70% GE (+1%) vs. 69% expected vs. 74% year ago – Harvested – 16% vs. 21% expected vs. 49% year ago

Flat price wheat continues to languish from only so-so exports, a strong US dollar and an overall bearish US Ag economy. US wheat continues to be a secondary world export market. Cheap corn prices have tempered the need for feed wheat. The one positive I took from today’s trade is the KC market tries to recover vs. the Chgo contract for the 3rd day in a row. Hard wheat is the lion’s share of the US crop. For it to try and come back against all-time lows vs. the Chgo contract, I think, should be viewed as a positive. Other than that there is not much to talk about here.

Interior cash US wheat markets remain quiet. This holds true for the export markets as well. Bear spreads were working in Chgo out to March then we saw some minor bull spreading. KC spreads saw some mixed spreading with only fractional changes.

Dec Chgo wheat continues to honor the $4.70 support level. Closes with conviction below that level will suggest something closer to $4.60. Dec KC wheat is upflagging out of the hole ($4.00). Overall volume in the US wheat futures has tapered off in recent days. This I believe suggests the development of consolidation. With that said the MO for trading becomes fading short term extremes vs. chasing them.

Daily Support & Resistance for 08/20

Dec Chgo Wheat: $4.70 ($4.65) – $4.79

Dec KC Wheat: $4.00 – $4.11

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.