Wheat prices gather support from global weather concerns, soybean rally

Demand is weighing on the market.

A general rise in wheat prices led by higher export values for Russian wheat, along with some dryness concerns for both the U.S. and Black Sea region planting seasons have helped to support very strong gains for December wheat.

Technically, the close above $5.55 in December Chicago Wheat is a bullish development and leaves a test of the September 1 highs and maybe $5.82 as the next resistance areas.

The close above $4.80 per bushel, in December KC wheat, is also a bullish technical development and leaves $5.01¼ as the next upside target.

Traders indicated that this week’s Egypt purchase from Russia was done at prices that were $8.00 to $10.00 per tonne higher than the previous tender on September 3. 

Thursday’s export sales report showed that for the week ending September 10, net wheat sales came in at 335,700 tonnes for the 2020/21 (current) marketing year and 300 for 2021/22 for a total of 336,000. Traders had expected sales near 300,000 to 700,000 tonnes. Cumulative sales for 2020/21 have reached 49.5% of the USDA’s forecast for the marketing year vs. a five-year average of 47.8%.

One of the factors supporting the market Thursday was talk of active tenders recently, as demand is picking up. This makes the U.S. sales news disappointing to the bulls.

Market Ideas 

Short-term support for December Chicago Wheat comes in at $5.50, with $5.68 and $5.81 as the next upside targets. December Kansas City weat support comes in at $4.80, with $5.01 as the next upside target. December Minneapolis wheat support comes in at $5.36, with $5.49 and $5.59 as next resistance.

For daily updates on cattle, hogs, corn, wheat, and the soy complex, visit hightowerreport.com.

*** This report includes information from sources believed to be reliable and accurate as of the date of this publication, but no independent verification has been made and we do not guarantee its accuracy or completeness. Opinions expressed are subject to change without notice. Any information or recommendation contained herein: (i) is not based on, or tailored to, the commodity interest or cash market positions or other circumstances or characterizations of particular investors or traders; (ii) is not customized or personalized for any such investor or trader; and (iii) does not take into consideration, among other things, risk tolerance, net worth, or available risk capital. Any use or reliance upon the information or recommendations is at the sole discretion and election of the subscriber. The risk of loss in trading futures contracts or commodity options can be substantial, and traders should carefully consider the inherent risks of such trading in light of their financial condition. Any reproduction or retransmission of this report without the express written consent of The Hightower Report is strictly prohibited.

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