Wheat Commentary
Dec Chgo Wheat closes 5 ¼ cents lower ($4.22), March 5 cents lower ($4.38 ½) and July 4 ½ cents lower ($4.62 ¼)
Dec KC Wheat closes 6 cents lower ($4.16), March 5 ¾ cents lower ($4.33 ¾) and July 5 ½ cents lower ($4.64)
Weekly Wheat Export Inspections – 259.2 K T. vs. 250-450 K T. expected
Weekly Winter Wheat Conditions – 52% GE (-2%) vs. 54% expected vs. 58% year ago
It seems the adage continues to be “When in doubt about being long corn and/or soybeans make sure you sell some wheat against it to be safe”. Supportive fundamental type news remains lacking for the US wheat markets. Rallies come when the trade feels the spec is too short. That was not the case on Monday given the short covering we saw Wednesday through Friday of last week. Today’s strength in the US Dollar was cited as an excuse for the market to sell off as well as inter-market spreading against corn and soybeans. March Chgo wheat came within 2 cents of its contract lows while March KC wheat came within half cent of its contract low.
Not much happens with interior cash wheat prices. The export market for SRW continues to be quiet while the export market for HRW continues to firm. Chgo spreads weakened fractionally. As of this writing it looks like the VSR for Chgo wheat will stay at its current 11 cents per month. The strength in the HRW export market has done little to influence the KC spreads as HRW export calls for 12% protein while 10.5 to 11% protein is deliverable.
Flat price wheat is hanging by a thread from pumping out new contract lows. What’s out there to keep it from happening? It’s dry in the central southern Plains. The competition’s recently planted wheat looks good. Argentina is in the midst of their harvest. As of this writing I’ll say new contract lows continue to be in the cards.
Daily Support & Resistance for 11/21
March Chgo Wheat: $4.33 (?) – $4.44
March KC Wheat: $4.30 (?) – $4.40
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