Wheat Continuing Higher into Wednesday

Wheats are looking to extend their Tuesday gains with 4 to 9 cent gains so far for Wednesday morning. Wheat prices ended report day higher, led by 1.3% to 1.6% gains in HRS futures. The hard red winter wheat market closed 5 ¼ to 7 ¾ cents higher with gains of up to 1%. Front month SRW futures were 2 ½ to 4 ¼ cents higher at the bell on report day. 

The WASDE report had no changes for the US balance sheet, though 10 mbu of HRW exports were shifted to HRS – now 155 and 215 mbu respectively. As a whole, output was left at 1.734 bbu and carryout was maintained at 615 mbu compared to the 614 average trade guess. 

World changes saw a 6 MMT cut in estimated production, with –3 MMT for Australia, -2 for Canada, -1 MMT for each Argentina and the EU. Those were partially offset by +1.5 MMT for Ukraine. Wheat carryout was 7 MMT tighter, mainly reflecting the production losses, though import demand also shrank 1.8 MMT from the prior forecast. If realized, the world wheat ending stocks at 267 MMT would be the tightest in 8 years and the stocks/use ratio would be a 9 year low. The stocks/use ratio ex-China would be the tightest since 2007/08.

Sep 23 CBOT Wheat  closed at $5.60 1/4, up 4 1/4 cents, currently up 4 1/4 cents

Dec 23 CBOT Wheat  closed at $5.87 1/2, up 3 cents, currently up 8 3/4 cents

Cash SRW Wheat  was $4.99 3/4, up 3 cents,

Dec 23 KCBT Wheat  closed at $7.30 3/4, up 7 cents, currently up 8 1/2 cents

Cash HRW Wheat  was $6.58 1/4, up 7 cents,

Dec 23 MGEX Wheat  closed at $7.79, up 12 1/4 cents, currently up 6 cents