GSCI Re-Weighting at End of Week

MGEX wheat has been stable against CBOT for a few weeks now with a premium mostly in the low 80 cents/bushel for March futures. With the cash market for Hard Spring Wheat at around $1.30 premium to Soft Red Winter and the carry costs much higher for CBOT, there should be pressure to increase the March MGEX premium. Also, the annual GSCI re-balancing starting Friday should put further downward pressure on March CBOT. The re-balancing should also serve to depress Corn relative to Ethanol and Oats which are not in the GSCI index. (Wheat and Corn outperformed last year and so are currently overweight in the index and will be reduced.)