The MGEX/KC intermarket spread has been in a narrow range for the past few days. Demand for Sep MGEX still seems strong with the Sep/Dec calendar spread trading at just 2-3 cents discount for Sep. KC, on the other hand, is trading out at over 80% of the new KC full carry (9 cents/month storage rate from July to Dec). So, for now, I am sticking with the long MGEX/short KC position.
On the CBOT wheat, the Sep/Dec calendar spread has gone to steeper contango with Sep more than 40 cents under Dec--about 62% of the VSR-defined full carry. While I don't know if that spread can average over 52 for the VSR calculation period (which could bump the full carry number up to about 73 cents), I am adding a bit to that short Sep/long Dec position.
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