The outlook for wheat futures remains that cold & dry weather will reduce the forthcoming yield potential in the fields of the world’s biggest exporter of wheat (here in the US). This view is seen in the ten-month high in wheat futures prices just this morning.
A prominent weather forecaster stated in a report earlier today about two-thirds of the wheat growing region will remain dry for the remainder of this month. Other USDA data reveals wheat crops deteriorating in both Kansas & Texas as of last weekend and the ongoing drought in Texas has expanded north of its boarders.
Matt Zeman, a senior commodity broker at Kingsview in Chicago, had this to say regarding the current wheat futures situation, “The wheat crop is in danger of seeing significant yield losses, and the dry forecast is not doing the (wheat futures) market any favors.” Zeman adds, “Wheat needs rain-and lots of it very soon.”
The trend in wheat futures is up with no top yet in sight. We had been long Kansas City Wheat until the “target price” was realized, and we exited CBT Wheat when it was realized the market couldn’t hold its gains.