Wheat Comment 10-26-09

Wheat Morning Update & Commentary Despite the negative finish to the day, wheat continues to look positive on the weekly charts. Planting issues and increased rain across the Ohio River valley have Chicago up 1 percent in overnight trade. Philippine feed makers bought a total of 133,000 mt of feed wheat, Black Sea origin for $210 per tonne CIF. Bangladesh, and Iraq remain around the market for wheat. As a response to low cash prices, Russia announced that it will begin a grain intervention program starting on November 2nd. Basis values remain flat, despite the 10 percent rally in wheat futures. SRW Basis remains burdened by a full pipeline. HRW has firmed as more buyers seem to be stepping into the market. PNW pipeline remains full. 2009 Soft Wheat production in Italy was estimated at 3.27 mln mt up from the prior estimate of 2.95 mln mt. Australia's western wheat belt should continue to see beneficial rains, however dry weather and high temps across grain belts in Argentina continue to stress crops. Friday's trade establishes a high for the time being. Look to sell flat prices rallies, covering shorts in the $5.30 area. Buying KC Selling Chicago at even money or better remains a trade. Overnight markets had fairly active trade with Chicago trading 3907 contracts. Chicago closed up 5 1/2 cents. Kansas City finished overnight trade up 6 cents and MPLS closed up 6 3/4 cents. Kansas City/Chicago spread is now trading at 2 1/4 in the DEC. The MPLS ...