March Chgo Wheat closed 8 cents higher ($5.49), May 7 cents higher ($5.51 ¾) & July 6 cents higher ($5.53 ½)
March KC Wheat closed 10 cents higher ($4.70 ½), May 10 ¼ cents higher ($4.79) & July 10 cents higher ($4.86 ¼)
March Mpls Wheat closed 4 ¼ cents higher ($5.47 ¼), May 4 ½ cents higher ($5.56) & July 4 ¾ cents higher ($5.64 ¼)
Weekly Wheat Export Sales – old crop vs. 200-900 K T. expected – new crop vs. none expected
Flat price wheat was the leader of the Ag complex today. Reports out of Russia suggest exports may not be as big as originally thought and there are ideas that their exports may be cut further in January. The KC market was the upside leader followed by Chgo and Mpls bringing up the rear. The story behind the wheat rally has not changed; lower winter acres in the EU due to excessive moisture at planting time, dryness and possible exposure to winter elements for the Black Sea crop and decades lower winter wheat acres in the US. Even though the flat price in Chgo may be losing its dominance over KC quality issues in last season’s SRW crop will keep that market well supported.
Advertised basis levels for standard protein wheat continue to run unchanged with large premiums being paid for quality SRW. Export basis too run unchanged. Chgo spreads perform quite well due to the flat price buying as well as the ongoing quality issues. KC spreads ran fractionally softer upfront while March, May & July gain on Sept forward.
Flat price Chgo wheat springboards higher out of its recent downflagging. In recent days KC wheat had been in a sideways mode sitting on top of its 200-day moving average. Today blew up and out of that 6 days of sideways along with taking out a major downtrend line that has been with us dating back to August of 2018. I’ve never been a fan of chasing short term extremes when trading flat price wheat and that has served me quite well in the past. It will be interesting to see if this time is different.
Daily Support & Resistance for Dec 27th
March Chgo Wheat: $5.43 – $5.57 (?)
March KC Wheat: $4.64 – $4.78
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.