Wheat Analysis - Feb. 23

winter wheat
winter wheat
(AgWeb)

Price action: May SRW wheat futures rose 32 1/4 cents to $8.84 3/4, while May HRW wheat rose 31 cents to $9.18, both lifetime-high settlements. May spring wheat rose 15 cents to $10.02 3/4, a two-month closing high. Nearby HRW and SRW futures ended at the highest levels since late 2012.

Start 1-month Pro Farmer trial for additional crops analysis, including market recommendations.

Fundamental analysis: Nearby winter wheat futures soared to the highest levels in over nine years on concern Russia’s escalating aggression toward Ukraine will disrupt the global grain trade. Russia and Ukraine combined account for nearly 30% of global wheat exports and almost one-fifth of world corn exports. Deteriorating conditions for the U.S. HRW wheat crop, based on individual state ratings, exacerbated supply concerns. In Kansas, the “good” to “excellent” ratings for HRW wheat dropped to 26% (down four points from the end of January), while Oklahoma fell to 9% (down seven points) and South Dakota fell to 24% (down seven points).

When the individual state crop ratings are plugged into the weighted Pro Farmer Crop Condition Index (CCI; 0 to 500 point scale, with 500 being perfect), the HRW crop plunged to a rating of 259.0, down 11.4 points from the end of January and 65.4 points below the end of November. At the current level, the CCI rating would be 71.3 points below the five-year average for the beginning of April when USDA starts releasing weekly national crop condition ratings.

Start 1-month Pro Farmer trial for additional crops analysis, including market recommendations.

Technical analysis: Bullish momentum accelerated as HRW and SRW markets broke decisively above the trading ranges of the past two months and posted contract highs. Based on continuation charts, upside targets for SRW futures include $9.00 and $9.47 1/4, the 2012 high. Upside targets for HRW futures include $9.48, the 2012 high, and $9.90 1/4, the 2011 high. May HRW and SRW contracts both pushed into overbought territory, ending above 70 on the Relative Strength Index.

 

Tags

PRO FARMER
 

Latest News

Market Analysis
AgDay Markets Now: Darren Frye Says Grain Markets Post Higher Week but Will Need These Factors to Keep Rallying
AgDay Markets Now: Darren Frye Says Grain Markets Post Higher Week but Will Need These Factors to Keep Rallying

Darren Frye, Water Street Solutions, says the wheat rally came on weather and technical buying, which also helped corn and soybeans post a higher week. He's not sure it can continue without a bigger weather issue.

Michelle Rook
Market Analysis
Why Did Jerry Gulke Make Some Last-Minute Planting Changes on His Farm?
Why Did Jerry Gulke Make Some Last-Minute Planting Changes on His Farm?

Gulke Group president Jerry Gulke explains why he made the last-minute decision to switch 200 acres of corn to soybeans.

Michelle Rook
Pro Farmer Analysis
Wheat Outlook 5-30-90 Days (4.26.24))
Wheat Outlook 5-30-90 Days (4.26.24))

Recap of the week's price action, advice and outlook broken down into the next 5, 30 and 90 day segments.

Pro Farmer Editors
Market Analysis
Grains Close Higher for the Week: Does the Market Need to Rally and Add More Risk Premium or Not?
Grains Close Higher for the Week: Does the Market Need to Rally and Add More Risk Premium or Not?

Grains end mixed Friday but higher for the week led by wheat.  Cattle make new highs for the move helped by stronger cash.  Can the markets continue to move higher?  Darren Frye, Water Street Solutions, has the answers.

Michelle Rook
Beef
APHIS To Require Electronic Animal ID for Certain Cattle and Bison
APHIS To Require Electronic Animal ID for Certain Cattle and Bison

APHIS issued its final rule on animal ID that has been in place since 2013, switching from solely visual tags to tags that are both electronically and visually readable for certain classes of cattle moving interstate.

Greg Henderson
Taxes and Finance
A Margin Squeeze is Setting in Across Row-Crop Farms, and 80% of Ag Economists Are Now Concerned It'll Accelerate Consolidation
A Margin Squeeze is Setting in Across Row-Crop Farms, and 80% of Ag Economists Are Now Concerned It'll Accelerate Consolidation

There's an immense amount of pressure riding on this year’s crop production picture, and with a margin squeeze setting in across farms, economists think it could accelerate consolidation in the row-crop industry. 

Tyne Morgan
View More