Wheat Future Post Double Digit Friday Gains (Corrected)

The wheat market was pounded lower all week as the market sought a level that would generate a meaningful volume of export sales transactions. That changed on Friday, as shorts bought back positions to protect profits against weekend surprises, and there were reports of additional explosions and fires near the large Russian port of Novorossiysk. Chicago futures had the biggest bounce, up 16 to 23 ¾ cents on the day.  Kansas City HRW futures were up 14 to 20 ½ cents.  MPLS spring wheat gained 11 ¾ to 15 cents. 

Export commitments of shipped and unshipped sales for all wheat are now 36% of the USDA forecast, lagging the average pace by 7 percentage points. It is still early in the marketing year, with 16% of the forecast shipped, vs. the 19% average. Rumors continue that India is negotiating to buy a slug of Russian wheat at a steep discount.  Russia hiked their wheat export tax to reflect the weakness in the ruble (and a strong shipping pace), going from 3,713 rubles/MT to 4,269 per. 

The Friday afternoon Commitment of Traders report showed the managed money spec funds clinging to a net long of 587 contracts in KC HRW futures on August 15. They had reduced it by 4,670 contracts during the reporting week. They remained heavily net short in Chicago SRW at -65,590 contracts, expanding the position by 10,195 contracts during the reporting week. 

Sep 23 CBOT Wheat  closed at $6.13 1/4, up 23 3/4 cents,

Dec 23 CBOT Wheat  closed at $6.39, up 23 3/4 cents,

Cash SRW Wheat  was $5.46 5/8, up 23 7/8 cents,

Sep 23 KCBT Wheat  closed at $7.53 1/2, up 20 1/2 cents,

Cash HRW Wheat  was $6.92 1/2, up 20 1/2 cents,

Sep 23 MGEX Wheat  closed at $8.01 3/4, up 14 cents,

On the date of publication, Alan Brugler did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Read More

Leave a Reply

Your email address will not be published. Required fields are marked *