Foreign Exporters & Domestic Ranchers Helping Push Wheat Futures Lower

Wheat futures is playing a cruel joke on our domestic farmers despite having the smallest crop harvested recently for the past three years. Wheat futures are finding lower prices because of outside factors such as surging wheat output overseas and a switching in feed in domestic use.

Now that feed prices have come back down to reality, US cattle ranchers have resumed using more corn in their livestock’s feed – which makes sense. What makes more “cents” is the fact our strong US Dollar is promoting other nations to look for wheat supplies elsewhere where the supply is much more plentiful – and less expensive.

“The obvious choice for wheat importers are to buy where their currency is the strongest, and wheat supplies abound,” said Barb Levy, chief director for The Fox Group’s futures division in Chicago, shared her fundamental analysis insight regarding the current wheat futures situation. Levy added, “As long as our domestic wheat prices remain uncompetitive, we can expect lower (wheat) futures prices.”

The trend for wheat futures is down with no bottom yet in price. I will need some type of relief rally before getting short wheat futures.

ALL COMMENTARY IS CONSIDERED OPINION & VIEWS FROM THE AUTHOR AND NOT A SOLICITATION OF ANY SECURITIES. THE RISK OF LOSS IN TRADING COMMODITY INTERESTS CAN BE SUBSTANTIAL. YOU SHOULD THEREFORE CONSIDER WHETHER SUCH TRADING IS SUITABLE FOR YOU IN LIGHT OF YOUR FINANCIAL CONDITION.