Dec Chgo Wheat closed 4 ¾ cents lower ($5.14 ¾), March 6 cents lower ($5.25 ¼) & July 2 ¾ cents lower ($5.37 ¼)
Dec KC Wheat closed 1 ¾ cents lower ($4.82 ¾), March 1 ¾ cents lower ($5.10 ¼) & July 1 ¼ cents lower ($5.30 ¾)
Weekly Wheat Export Inspections – 418.4 K T. vs. 350-600 K T. expected
Flat price wheat backs and fills last week’s late rally. Chgo took the brunt of the profit taking while KC did some tightening vs. Chgo. Weekly export inspections were deemed no big deal when compared to last Friday’s weekly export sales. Bear spreading in Chgo was noted big time as the thought exports will increase as we move into the second half of the marketing year eventually tightening the old crop stocks by the end of the marketing year. Adding to that rationale is that winter wheat seedings will be far less vs. originally thought due to wet conditions in the HRW areas this fall and the long drawn out harvest in the SRW areas. Russian export prices have been grinding higher over the past number of weeks. If this continues US prices will be buoyed higher as well.
Interior cash wheat markets remain relatively quiet despite Friday’s sharp rally. Chgo spreads had a noticeable bearish bias while KC spreads ran only fractionally softer within the current crop year. The attitude is that better exports will come but the thought is becoming later vs. sooner. That explains some of the wide carrying charges.
Daily wheat price charts read higher. So far all today was some backing and filling out of the short term overbought that was created with Friday’s rally. I will admit the wheat markets still have to contend with some big looking overhead congestion. Not much is expected from the USDA’s supply-demand update. The US carryout is expected to increase by 7 million bu. and the World carryout is expected to increase by 80 K T. I would like to think we’re supposed to be buying breaks in the US wheat futures markets with emphasis on the word “breaks”.
Daily Support & Resistance for 12/11
Mch Chgo Wheat: $5.20 – $5.35
Mch KC Wheat: $5.00 – $5.18
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