Steve Bruce of Walsh Trading - InsideFutures.com - Tue Feb 12, 10:48AM CST

The only constant is the tightening of the Chicago wheat spreads.  Fear of receiving vomitoxin laden deliverable stocks, at a discount might,  be a reason for stopping the trend and allow the basis to perform the task of rationing milling quality. Things will stay interesting in wheat through March deliveries as the running moving average in both Chicago and Kansas City are at levels which requires that storage rates decrease next month..we'll have to widen the spreads a lot, and quickly,  to   leave rates unchanged.  Given the light acreage seeded to winter wheat this Fall any problems with weather and coming out of dormancy could spark a rally and/or high anxiety.



                                Even though the trade has been talking about the detrimental impact of the hot and dry weather in December and January to Brazilian bean yields there still appears to be enough in the world to stem any concern of nearby tightness. US producers appear to be willing to move stocks off farm and basis levels are having a tough time showing strength. Spreads in both corn and beans are stagnating and it appears that we could remain on the defensive through deliveries.



                                Flat price in all grains have been stuck in a rut the past three months. Trade talk is that we need to see a rally in new crop corn values to entice more acres this Spring.       






The information contained on this site is the opinion of the writer and obtained from sources cited within the commentary. The impact on market prices due to seasonal or market cycles and current news events may already be reflected in current market prices.     




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Steve Bruce

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