Price action: May SRW wheat rose 11 1/2 cents to $7.10 1/2, near the session high and hit a two-week high. For the week, May SRW rose 30 3/4 cents. May HRW what gained 16 cents to$8.35 3/4, hitting a three-week high and increasing 37 1/2 cents on the week. May spring wheat futures rose 11 3/4 cents to $8.35 3/4.
5-day outlook: It was a good week for the winter wheat futures bulls as short covering and perceived bargain buying were featured. The technically bullish weekly high closes on Friday also suggest some follow-through buying interest early next week. The fly in the bulls’ ointment could be keen risk aversion next week amid the banking crisis that continues to play out. If that situation continues to produce general trader/investor anxiety, then buying interest in the grain futures would be limited.
Traders will continue to closely monitor the U.N. Ukraine grain-shipping agreement negotiations. Reports todays said Russia was extending the deal for 60 days. However, both Ukraine and Turkey say the deal must be rolled over in full under the existing terms, including the 120-day duration.
30-day outlook: Weather patterns will come more into focus as springtime is near. World Weather Inc. today reported drought in the U.S. western Plains is the most serious out of all dryness in North America. A little rain is possible in the next ten days, said the forecaster. Concern remains over flood potential in a part of the Red River Basin of the North and in the upper U.S. Midwest, although much depends on how fast the snow melts and how much rain falls during the snowmelt season. Europe wheat, barley and rye areas are experiencing mostly good conditions for the start of spring growth and planting. India’s wheat production may be reduced in unirrigated areas this year because of limited rain and warm temperatures since January 1. The first USDA Crop Progress report is April 3, when traders will get a better read on HRW crop conditions.
90-day outlook: The U.S. dollar index has seen choppy and volatile trading recently, as the banking crisis plays out. An appreciating greenback would exacerbate already tepid worldwide demand for U.S. wheat. Weekly export sales this week came in at 250,700 MT. Despite the weakest exports since early January, net sales this week came in 22% above the prior four-week average at 336,700 MT. Wheat bulls are hoping foreign buyers step up and take advantage of the lowest U.S. prices since 2021.
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