Wheat Commentary
May Chgo wheat closes 6 cents lower ($4.30 ¼), July 6 cents lower ($3.45 ½) and Dec 6 cents lower ($4.79 ½)
May KC Wheat closes 8 ¼ cents lower ($4.45 ¼), July 8 cents lower ($4.57 ¼) and Dec 7 cents lower ($4.92)
Weekly Wheat Export Inspections – 624.3 K T. vs. 350-550 K T. expected
How easily the flat price breaks vs. the grinding higher we saw in the latter part of last week. Forecasters are suggesting multiple chances of beneficial rainfall for the dry areas of the central southern US Plains over the next couple of weeks. On March 31st wheat traders will be looking a potentially large Quarterly Stocks figure vs. the possibility of the lowest Prospective Plantings of wheat in the last number of decades. The success or failure of the crop will go far in dictating the long direction of the market. As of this writing the actual rainfall over the next number of weeks will dictate that success or failure. As of Monday the trade was not willing to fade the current forecasts.
Interior cash wheat markets remain quiet. The HRW market at the Gulf has been under pressure in recent days while the SRW market at the Gulf has had a bit of an upwards bias. Chgo spreads ran unchanged on the day while still staying relatively wide. KC spreads ran fractionally softer on the day and they too remain relatively wide.
As I mentioned earlier – so tough to rally; so easy to break. I think that says it all at least for the near term. Price direction for the near term will be all about weather; forecasts vs. actual rainfall. Charts, however, suggest the current run to the downside may not yet be over.
Daily Support & Resistance for 03/21
July Chgo Wheat: $4.40 – $4.49 ½
July KC Wheat: $4.52 – $4.61
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.