Price action: May SRW wheat futures rose 15 1/2 cents to $6.82 1/2, near the session high, gaining 7 cents on the week. May HRW wheat futures surged 33 1/2 cents to $8.78 3/4, and for the week rose 14 1/4 cents. Spring wheat futures rose 26 3/4 cents to $8.76 1/4.
5-day outlook: The technically bullish weekly high closes in wheat futures markets today set the table for follow-through technical buying early next week. Short covering and bargain hunting were featured in the wheat markets today. Forecasts for the possibility of very cold weather at the end of next week helped to boost wheat futures today. World Weather Inc. reported frost and freeze potentials may be on the rise for the central U.S. Plains and Midwest April 21-23, “but how significant that may or may not be is still up for great debate; cooling is likely, though,” said the forecaster. Hard red winter wheat will be more vulnerable to frost and freezes because of recent warm to hot temperatures and another bout of the same that is expected during mid-week next week. Meantime, U.S. west-central and southwestern Plains are still being impacted by significant drought and no relief is expected in the southwestern Plains for at least a week.
30-day outlook: The Russian grain-shipping deal that looks shakier by the day supported the wheat markets late this week and is likely to keep a floor under prices in the coming weeks. The West still has time to remove “obstacles” hindering the implementation of the Black Sea grain deal before a deadline on May 18, senior Russian diplomat Mikhail Ulyanov said. Russia has been increasing its rhetoric that the grain deal won’t be extended unless its demands are met.
90-day outlook: The U.S. dollar index today hit a 2.5-month low. Continued greenback weakness may provide support to the wheat markets in the coming months, but U.S. harvest pressure is likely to limit any sustained price rallies. On a positive note for HRW, the drought-stricken HRW crop is likely to produce higher-protein grain, which is likely to reduce the price advantage of HRS wheat this summer.
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