May Chgo Wheat closed 5 ½ cents lower ($4.56 ¾), July 4 ¾ cents lower ($4.63 ½) & Dec 4 ¼ cents lower ($4.86 ¾)
May KC Wheat closed 6 ½ cents lower ($4.36 ½), July 5 ¾ cents lower ($4.46) & Dec 3 ½ cents lower ($4.79)
Weekly Wheat Export Inspections – 353.7 K T. vs. 400-700 K T. expected – Cumulative Inspections – 17.975 M T. vs. 19.156 M T. year ago
Is today’s market action in the Chgo and KC wheat markets telling us we’ve done enough short covering for now? Weekly export inspections continue to disappoint. Recent moisture in the southern Plains has to be viewed as beneficial for their HRW crop. This week’s drying in the SRW areas that have been deemed as too wet reduces just some of the recent concern. The action is Mpls is telling us there is still legitimate concern that the HRS planting season will not happen in a timely manner. See the latest from the NWS below. At the end of the month the USDA will issue its Quarterly wheat stocks data as well as wheat acreage updates. As of this writing the Quarterly stocks data should act as a reminder of our less than market making export market. The acreage data will report on prospective spring wheat plantings. What that report won’t say is the timeliness of the planting and whether or not we’ll lose some of that acreage due to what looks like a late start.
The interior SRW cash wheat market runs mostly steady with the Ohio River being just a touch better. The Gulf market for SRW runs unchanged. Chgo spreads eased up front with the flat price selling. The interior HRW cash market continues to show a firm tone. The recent rally in the KC market has broken the Gulf HRW market 10-15 cents from early last week. KC spreads have been sideways for the past month of so but look like they are ready to challenge recent lows.
Today’s price action in Chgo and KC are suggesting we may have covered enough shorts for the time being. If you are a believer that we have seen interim lows you will want to focus on the retracement of last week’s rally as to where it finds support. I’m looking at $4.50 initially for May Chgo followed by somewhere between $4.45 and $4.40. Let your shorter term inter-day charts be your guide. May KC wheat sees its first level of minor support at $4.30 followed by $4.25 to $4.20. It is very unnerving watching KC lose 10 cents to Chgo over the past 3 days.
Daily Support & Resistance for 03/19
May Chgo Wheat: $4.47 – $4.65
May KC Wheat: $4.31 – $4.47
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