Market Recap
As the trading week drew to a close, wheat futures experienced a slight dip on Friday but managed to preserve a weekly gain. Chicago futures saw a decline of up to ten cents on the final trading day, yet March prices remained 13 cents higher compared to the previous Friday. Meanwhile, KC wheat futures slipped by 5 to 8 cents at week’s end, with March still holding onto a modest gain of 1 ½ cents. In the ongoing battle between HRS and SRW wheat varieties, the March spread now favors SRW with a 4 ¾ cent premium. Notably, March options have ceased activity as the delivery process approaches, marking a significant juncture in the commodities market. Lastly, spring wheat futures closed out the week 7 ¾ to 9 ¾ cents weaker, resulting in a net 13 ¼ cent decline over the course of the week.
Trader Insights
Latest CFTC data revealed that managed money traders were 68.5k contracts net short in SRW wheat, indicating a 13k contract increase in net short positions for the week following new selling activity. Moreover, speculative traders were also net sellers of HRW wheat during the week ending on 2/20, reporting a 42k contract net short at the settle. The weekly Commitment of Traders report showcased Minneapolis spec traders with a 24.2k contract net short in HRS as of 2/20, a slight change from the prior week’s 24.8k contract net short position.
Export Sales and International Trade
Weekly wheat export sales stood at 233,500 MT for the week ending on 2/15, falling below the estimated range and marking a 34% decrease from the previous week. Of the total sales, 98.5k MT were attributed to HRW, reaching a 5-week high for this particular class. Additionally, the report indicated 46.6k MT of new crop wheat sales for the week. On the international front, Japan made a substantial purchase of 115,921 MT of wheat in their weekly MOA tender, with 30,435 MT sourced from the US and the remainder split between Australia and Canada.
Mar 24 CBOT Wheat closed at $5.73 1/2, down 9 3/4 cents,
May 24 CBOT Wheat closed at $5.69, down 10 1/4 cents,
Mar 24 KCBT Wheat closed at $5.68 3/4, down 5 1/4 cents,
Mar 24 MGEX Wheat closed at $6.41 1/2, down 9 3/4 cents,
On the date of publication, Alan Brugler had no direct or indirect positions in any of the securities cited in this article. All information and data provided in this article are for informational purposes only.
The views and opinions expressed are solely those of the author and do not necessarily reflect the views of Nasdaq, Inc.
