The following commentary does not necessarily reflect the views of AgWeb or Farm Journal Media. The opinions expressed below are the author's own.
Kevin Van Trump has over 20 years of experience in the grain and livestock industry.
Wheat continues to flirt with NEW lows in the sub-$6.50 range, prices not seen since June of 2012... while I however remain "neutral to somewhat bullish" this market.
My reasoning: The Chinese wheat crop might be worse than what is being reported; The Black Sea Region, while harvesting much better yields than last year seems to now be backpedaling a bit in terms of total estimated production. The USDA's office in Kazakhstan is now thinking their production will be more like 14.0 million metric tons vs. the USDA who just recently lowered their estimate to 14.5 million tons because of a "lower planted area;" I am also starting to hear more talk out of Moscow that though wheat production has drastically improved over last year, Russian wheat exports might not make that big of a jump. There is talk the 54 million ton Russian wheat production number the USDA is currently using might need to be dropped to 53 million tons; Another bullish card in my opinion is the fact the former Egypt government let wheat supplies fall to dangerously low levels, meaning the country may soon have to be more aggressive buyers than in the past; Lets also not forget the US spring wheat tour starts today, with a record 70 plus participants leaving Fargo on routes across ND, western MN and northern SD. My hunch is with conditions falling, an extremely late planted crop, and many fields left unplanted, participants might be a little thrown back by what they find this year. Producers, looking to price more bushels, in my opinion, should continue to sit tight for a bit. To recieve my next recommendation sign up for my free daily report by clicking here.
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