Price action: March SRW wheat futures rose 2 1/2 cents to $6.16 and near mid-range. For the week, March SRW fell 12 cents. March HRW wheat futures gained 2 1/4 cents at $6.28, near mid-range and for the week down 14 cents. March spring wheat rose 3/4 cent to $7.12 but lost 11 1/2 cents on the week.
5-day outlook: The winter wheat futures bulls staged a modest recovery in prices late this week after hitting multi-week lows in early trading Thursday. Such may give the speculative bulls some momentum to do some follow-through buying early next week. Wheat traders next week will continue to focus on the daily price action in the U.S. dollar index. The USDX today hit a three-week high but then backed off sharply, to suggest the greenback bulls are near-term exhausted. That would be a positive for wheat traders next week. Wheat traders will also take their daily cues from price action in the corn market. Corn futures faltered this week, with March corn hitting a new contract low today. Wheat traders will closely scrutinize next Friday’s (Jan. 12) monthly USDA supply and demand (WASDE) report.
Wheat traders will be closely watching a wintry weather pattern in the U.S. Plains early next week. World Weather Inc. today said a strong storm system is expected to impact the region Monday. Snow and strong winds will be involved with this and some rain as well in southeastern areas. The greatest impacts from this system will be possible from the Oklahoma Panhandle and northern Texas Panhandle through central Kansas and into southeastern Nebraska. “Blizzard or near-blizzard conditions are likely,” said the forecaster. Another snow event is likely Jan. 12 – 13 as arctic air moves into the Plains.
30-day outlook: USDA this morning reported U.S. wheat export sales of 131,600 MT during the week ended Dec. 28. That’s down 52% from the previous week and down 79% from the four-week average. This week’s rally in the U.S. dollar index will not help the wheat market bulls looking for improved foreign demand for U.S. wheat in the coming weekly sales reports. Better weekly U.S. wheat export numbers will very likely be need to jumpstart any significant rallies in the winter wheat futures markets.
90-day outlook: With colder weather forecast for U.S. wheat country in the near term, wheat traders in the coming weeks will be reminded that snow cover will be important to protect wheat plants from winterkill and for providing needed moisture in the spring. World Weather reports that early winter snow cover in much of the winter wheat regions is favorable. Trader focus in the coming weeks will also turn to the quarterly grain stocks and acreage reports that come out at the end of March.
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