Wheat futures recent uptick in activity may have have something to do with the world’s biggest wheat buyer conceding to import wheat with traces of fungus in it despite an ongoing dispute. Wheat futures is down .05 cents today currently trading at $4.7225 per bushel at the Chicago Board of Trade.
Egypt now says it will allow wheat with the ergot fungus into the country with the assistance of the UN Food & Agriculture Organization to help resolve the dispute on a scientific basis. The fungus is a common problem with grain shipments, but Egypt had put its foot down rejecting grain shipments in the past causing a crisis in global suppliers.
Laura Taylor, a senior market strategist at RJO Futures in Chicago, shared her fundamental view of the wheat futures market by stating, “This dilemma of ergot fungus with wheat has persisted for months now and maybe it does take a United Nations body of people to mediate the situation properly so the Egyptians have more confidence.” Taylor adds, “The country is, after-all, the biggest importers of wheat in the world and the problem could be elevated to a national security problem if it got out of hand.”
Wheat futures trend has turned “up” only recently with little follow through to the upside. I would expect wheat futures to test their contract lows soon.
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