CBOT corn and wheat continue to fall. While KC wheat is falling somewhat more slowly, MGEX is somehow keeping pace. The huge premium for July MGEX over Sep is gone--but July is still 10 cents over Sep. And looking at the MGEX website, spring wheat available for futures delivery continues to leave the elevators, so there is a chance the prompt market will get very tight for MGEX wheat.
Looking at the KCBT newsletter, there is still about $2.70/bushel premium for 14% protein wheat there. So when the market prices Dec MGEX at only 35-40 cents premium to Dec KC, it is anticipating a tremendous harvest of high quality spring wheat in September. If such a huge harvest did come in, how low would MGEX go relative to KC? Even? On the other hand, if it is the KC's 11% protein segment of the market that sees big harvests, which seems far more likely, then something like 80-100 cents premium seems more likely.
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