Analysis: Wheat

US Wheat Rebounds 2-6 Cents; World Cash Market Lacks Direction

Feb 22, 4:48 pm | Wheat

US and European futures settled moderately higher today, in large part due to Egypt’s latest tender results. Simply put, major importer consumption is at least intact following the recent rally, and so overall demand is sold. However, major exporting origins have done little in the last 10 days are now offered within $5-8/MT of one another (see below) at levels comparable to $4.40-4.50, basis spot CME & KC. New crop seedings and weather is awaited.   Egypt today secured 360,000 MTs of Russian and Ukrainian origin at an average fob price of $197/MT. This is the highest price of the season (up very slightly from last week), and suggest Russian exporters don’t need to be overly aggressive in the near…

Not Subscribed Yet?
The content that you are trying to view requires a subscription. Please click below to subscribe, or contact us by email at sales@agresource.com and by telephone at 312-408-0045

Log In

Wheat Falls, Looks to Test Major Chart-Based Support

Feb 21, 4:51 pm | Wheat

CBOT wheat futures closed lower and were never able to push in the green. News that India may raise their wheat import duty in March to protect their local farmers, left sellers above the market. Funds were net sellers of 4,200 contracts in lackluster CBOT volume.   Egypt’s GASC is tendering overnight for world wheat for March 25-April 4th shipment. Like prior tenders, it’s expected that GASC will take Eastern European and Russian wheat. Key will be the price paid and whether is above or below last week’s tender will be closely watched. ARC notes that Egypt normally starts to harvest its own wheat crop in April. It relies on those supplies until mid to late summer. As such, this…

Not Subscribed Yet?
The content that you are trying to view requires a subscription. Please click below to subscribe, or contact us by email at sales@agresource.com and by telephone at 312-408-0045

Log In

Wheat Extends Correction; Fund Short Position Smaller than Expected

Feb 17, 4:07 pm | Wheat

US and EU wheat futures ended lower as funds start to liquidate recently placed long positions. Today’s CFTC report included a managed funds net short position in Chicago of just 40,000 contracts, down 43,000 contracts from a week ago and much smaller than expected. Funds’ net short has been cut by 70% since mid-Nov, while fundamentals have barely changed. A steeper correction may lie ahead if additional weakness develops in the Black Sea cash wheat market.   Egypt in one its last tenders of the old crop year secured a hefty 360,000 MMTs of Russian, Ukrainian and Romanian origin for late March arrival at $195-196/MT, basis fob. Neither the origins nor price of execution was surprising. However, Russian interior wheat…

Not Subscribed Yet?
The content that you are trying to view requires a subscription. Please click below to subscribe, or contact us by email at sales@agresource.com and by telephone at 312-408-0045

Log In

Wheat Rally Loses Speculative Steam; Russian Cash Price Down

Feb 16, 4:13 pm | Wheat

US wheat futures fell 7-18 cents, led by Minneapolis, amid a lack of new fund buying and otherwise lack of any bullish fundamentals. AgResource mentions that Russian spot fob offers are slightly weaker for a second consecutive day – following an 8-week rally – and we maintain that March CME is overvalued above $4.50. Egypt is seeking optional origin supplies for late March, and the price of execution will be of particular interest – and whether Russian exporters turn more aggressive than what their fob quotes indicate.   NOAA’s spring climate outlook features ongoing drought in key areas of W KS and E CO, but drought improvement or elimination across the whole of OK. Needed rainfall is possible in NE…

Not Subscribed Yet?
The content that you are trying to view requires a subscription. Please click below to subscribe, or contact us by email at sales@agresource.com and by telephone at 312-408-0045

Log In

Wheat at New Rally Highs; Like Corn, Chart Pattern Supportive

Feb 15, 4:12 pm | Wheat

It was another day of solid gains in US wheat markets, though bullish fundamental news is absent. Russia’s ruble ended weaker for the first time in a week, and Russian cash offers, too, are down slightly from Tuesday. Relatively wetter weather patterns are offered to the US Central Plains and much of Europe and the Black Sea beginning next week, and spot CME futures at current levels are viewed as overvalued.   Temps in Europe and the Black Sea will also be at/above normal in the next 10 days, and so additional 2017 winterkill threats are in fast retreat. The midday GFS indicates heavy rain/snow across key areas of Southern Russia Feb 22-25. Similar precip is projected in Poland, and…

Not Subscribed Yet?
The content that you are trying to view requires a subscription. Please click below to subscribe, or contact us by email at sales@agresource.com and by telephone at 312-408-0045

Log In

Wheat Falls Slightly on US Dollar, ABARES

Feb 14, 4:45 pm | Wheat

US wheat futures fell marginally as the dollar (somewhat quietly) rallied to a new 4-week high, and as the trade further digested ABARES massive boost in Australian ’17 wheat production. We do note that the Russian ruble scored a fresh 18-month high today. Russian fob offers rallied, but Russian farmers have to be aware that if they store wheat into June, their return will be a -$10/MT or $.37/Bu.       There’s little compelling evidence for new highs. Australia now holds a record exportable surplus of 27 MMTs, of which only 7-8 MMTs has been shipped and/or sold, and replacement costs in Australia are only slightly above seasonal lows posted in early January.   The point is that with much…

Not Subscribed Yet?
The content that you are trying to view requires a subscription. Please click below to subscribe, or contact us by email at sales@agresource.com and by telephone at 312-408-0045

Log In

Wheat Rallies on Fund Short Covering; Fundamentals Turning Bearish

Feb 13, 4:19 pm | Wheat

US wheat futures started the week steady to weaker. KC wheat paced an early advance. Buying in HRW contracts continues above March’s 200-day moving average, while March CBOT‘s 200-day MA was well upstream.   Funds bought an estimated 7,000 contracts of wheat in an active trading session of 111,000 contracts of March Chi.    New crop Black Sea prices have been in decline in recent days. The attached graphic shows updated fob prices. First, US Gulf offers are now completely non-competitive (recall Gulf SRW was the world’s cheapest just days ago), and also notice the steep discount in Russia beginning in Apr/May. ARC hears new crop Russian wheat quoted at $175/MT, which is comparable to $4.20, basis July KC -…

Not Subscribed Yet?
The content that you are trying to view requires a subscription. Please click below to subscribe, or contact us by email at sales@agresource.com and by telephone at 312-408-0045

Log In

Wheat Rallies Further; Spot KC Exceeds 200-Day Moving Average

Feb 10, 4:32 pm | Wheat

Wheat futures rallied to a new seasonal high amid ongoing fund buying/short covering, and chart patterns that are supportive. This week AgResource has focused mostly on the Black Sea cash market, and it’s important that the market there continues to rally. Interior Russian prices this week are steady to even a bit weaker, but as the Ruble continues to strengthen, Russian wheat in dollars rose further. Russian spot fob offers now rest at $189/MT for spot, which is comparable to $4.50 spot KC, and until the Russian breaks, we doubt other world wheat markets will follow. Watching Black Sea values are key!   Otherwise, needed rain will fall mid/late next week across the S Plains and NOAA has expanded its…

Not Subscribed Yet?
The content that you are trying to view requires a subscription. Please click below to subscribe, or contact us by email at sales@agresource.com and by telephone at 312-408-0045

Log In