MGEX wheat didn't see any love today. While KC added 13 cents and CBOT added 7-8 cents, MGEX dropped 6 cents. The front of the MGEX curve was a bit weak too--both March/ May and May/July dropped a penny or two.
So now March MGEX is under $2.00 premium to CBOT and July is under $1.30 premium. I'm still betting it's a bargain here. The MGEX calendar curve is still strongly inverted and there is not some crazy stampede into CBOT (as in the 2010 Russian drought. MGEX wheat is the only wheat market in short supply. Is $1.95 premium too much? Maybe, but this is down from $2.70 premium for March just 6 weeks ago, so there is certainly less built into it now.
Happy New Year!
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