Agricultural News
Anderson Analyzes Bounce in Wheat Prices
Thu, 05 Feb 2015 18:35:47 CST
Wheat prices made a nice bounce this past week after several weeks of lower futures prices. On this weekend's edition of SUNUP, host Lyndall Stout interviews Oklahoma State University Crop Marketing Specialist Kim Anderson about the rally. He said a big cause of the movement was the funds getting out of short positions and buying their way out, which created some good movement in the market. He said Russia also reported they put in a 15 percent tax on their exported wheat, there was also reports of slightly lower stocks around the world and last week's U.S. exports were relatively high for wheat. He said all of those factors caused prices to move higher in bringing buyers into the market. Click on the LISTENBAR below to listen to the full interview.
"I think the funds are biggest driver going in the market right now, " Anderson said.
Anderson is also preparing for wheat harvest to begin in India, Pakistan and North Africa starting in March and April. The next exportable wheat harvest will be in the U.S. later on this spring.
In looking at the price outlook, Anderson said the July Kansas City wheat contract is right at $5.70 resistance level. He believes if the price can move through $5.70, then it's next target is $5.85. If the price gets through $5.85, then its possible the price will get to $6.10. Right now the floor of the market is at $5.33. Anderson said if prices this next week don't break through $5.70, prices could drop lower and test $5.33 level.
In looking at harvest prices, Anderson said at the current futures prices, that will equate to cash prices of $5.30 for harvest delivery. For corn, Anderson said farmers are looking at $3.85 to $4.30, depending on the location and basis level. For soybeans, Anderson said farmers are looking at $8.70 and sorghum is ranging from $3.65 to $3.84 in forward contracting. He said canola right now is around $6.40- $6.50 a bushel range.
If farmers still have wheat in the bin, Anderson encourages farmers to take advantage of these rallies in the market and sell a portion of the crop. He said if you get a 27 cent run, take advantage of it. He said farmers don't have to sell everything, but move some of it into the market.
In forward contracting, Anderson recommends farmers just wait and see what happens this spring. He said there is normally a spring rally around mid-March to the beginning of April.
This week on SUNUP, we talk with Jeff Edwards and J.D. Carlson about wheat, identifying first hollow stem and the Mesonet's First Hollow Stem Advisor tool. Then, Dave Lalman offers advice on moving cattle off wheat pasture.
-- In the Mesonet report, Al Sutherland covers the wind speeds and temperatures from this week's cold front, first hollow stem progress and 30-day rainfall amounts.
-- Next, Kim Anderson analyzes the recent jump in wheat prices and looks at summer crop prices.
-- In Cow-Calf Corner, Glenn Selk has tips on what to do if a cow is delivering a calf feet first.
-- In Food Whys, Nurhan Dunford explains the science behind high fructose corn syrup.
-- We invite viewers to Canola College February 19 in Enid.
-- Then, in Naturally Speaking, Dwayne Elmore examines rangeland forage regrowth after fire.
-- Finally, in Shop Stop, Wayne Kiner and Randy Taylor demonstrate how to test a vehicle's electrical system.
Catch SUNUP: Saturdays at 7:30 a.m. & Sundays at 6 a.m. on OETA-TV
SUNUP can be seen on OETA across the state of Oklahoma- Dr. Anderson's segment on the markets is one of the standard features of this weekly show from Oklahoma State University. Catch SUNUP online through the OSU website by clicking here or through YouTube by clicking here.
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