Like the rest of the grains, wheat was on the ropes last week as funds held a mass exodus across the complex.
The markets were already in a minor liquidation mode, when USDA released the quarterly stocks report along with the small grain summary. Finding another 300 million bushels of corn turned a minor sell-off into a rout. Chicago Dec wheat lost 65 cents for the week, while KC lost 68 cents and Minn was down 56 cents. Dec corn lost 55 cents and Nov beans were down 69 cents.
The wheat market had something for everyone this week, but it’s unlikely that anyone really got anywhere after all was said and done. Sharply lower, sharply higher price action just continued the pull-your-hair out volatility that has defined this market for the last six weeks. The charts ended the week with an outside week lower, but good luck if you think selling it is a slam dunk.
After spending most of the week slipping lower, wheat managed a strong day on Friday to end the week in positive territory. While fundamentals in wheat remain very positive, it’s the corn and bean market that has taken over leadership of the grain complex despite harvest in full gear. The grain complex is also finding huge support from hedge funds who added to record long positions in corn as the weaker dollar and disappointing yields fueled bullish attitudes.
Price action for the wheat complex remained volatile last week, as the market continued to digest the plethora of news and rumors emanating from the Russian drought. With so much uncertainty surrounding a major exporter, we can see why the markets have been so choppy.
Wow, wow, wow! Major resistance melted like a hot knife through butter as wheat futures rocketed higher on the record drought in Russia remaining as entrenched as ever. Record temperatures, hot winds and wildfires added to the decimated crops across the major growing regions of Russia, Kazakhstan and into Ukraine while the world tried to calculate what would become of the exporting capability of the world’s largest wheat exporting region.
The Russian drought has intensified the markets.
Wheat reaches 13-month high.
World prices seen higher vs. a year ago
Funds scramble to cover short wheat positions