July Chgo Wheat closed 15 ¼ cents higher ($5.04 ¾), Sept 15 ¼ cents higher ($5.12) & Dec 14 cents higher ($5.23 ¾)
July KC Wheat closed 18 ¾ cents higher ($4.60 ¾), Sept 18 ¼ cents higher ($4.71 ½) & Dec 16 ¼ cents higher ($4.91 ¾)
July Mpls Wheat closed 9 ½ cents higher ($5.57 ½), Sept 9 ¾ cents higher ($5.64 ¾) & Dec 8 ½ cents higher ($5.74 ½)
Weekly Wheat Export Inspections – 494.0 K T. vs. 400-700 K T. expected – Cumulative 24.162 M T. vs. 24.52 M T. USDA target
Weekly Winter Wheat Condition & Progress – 61% GE (-5%) vs. 65% expected vs. 38% year ago – Headed – 66% vs. 76% 5-year average
Weekly Spring Wheat Progress – Planted – 84% vs. 83% expected vs. 91% 5-year average – Emerged – 47% vs. 69% 5-year average
Surging corn prices, concerns over the US winter wheat quality, some dry spots developing in Russia all account for today’s higher prices. Spec/fund short covering continues to be the majority of the buying. If the current strength in corn continues demand for alternative feeding (wheat in this case) will come into view. With all of the water seen in the HRW and SRW areas it’s hard not to think quality has been impacted. The developing European wheat crop still looks good but there are concerns developing for spots in Russia where a dry bias has taken hold.
Interior cash wheat prices run steady to a shade easier. The SRW basis is mostly steady while in northeast Oklahoma bids for HRW are softening. The gulf for both varieties continues to be strong. Wheat spreads in Chgo were steady upfront but showed a bullish bias in the longer term time spreads. KC spreads had a similar look. Just how much of the spread support is due to spec/fund short covering vs. true concerns over quality remains to be seen.
July Chgo wheat is about 15 cents shy of challenging levels it broke down from in mid-February. July KC is 40-50 cents shy of the levels it broke down from in mid-February. It is my opinion that if and when July Chgo wheat challenges the $5.20 level it needs to be sold; at least first time up there. Overall wheat will continue to be a follower of corn until more is known as to the quality of the winter crop.
Daily Support & Resistance for 05/29
July Chgo Wheat: $4.90 – $5.15
July KC Wheat: $4.50 – $4.74
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