Wheat futures saw higher prices as the news of the domestic wheat crop is making a far worst-than-expected start than was thought due to dryness. Wheat futures extended gains from yesterday before closing a cent-and-a-half lower near $5.075 at the Chicago Board of Trade.
The USDA recently rated the US winter wheat crop in good or excellent condition at 47% which was well below the 55% anticipated rating. The low ratings which were worst than others include Arkansas (26%), Colorado (38%), Missouri (34%), Oklahoma (31%), and Oregon rated the lowest at only “8%” amongst all winter wheat variety growing states.
“These USDA figures hit the wheat (futures) market as a complete surprise,” said Gerry Plotkin, a Senior Market Strategist for R.J. O’Brien in Chicago, sharing his fundamental assessment of the wheat futures market. Plotkin adds, “Apparently drought is lingering on in America’s heartland, however there’s still about 20% more wheat to be planted so we shouldn’t read to much into this single report.”
The trend for winter wheat futures is mixed – soft-red variety still in a technical down-trend, while hard-red variety barely hanging on to its uptrend – so both at a crossroads. Before getting involved with wheat futures at this time I would suggest a clearer picture to unfold.
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.