Agricultural News
Domestic and Global Factors Cause Big Price Moves in Wheat Market, Anderson Says
Thu, 23 Jul 2015 19:09:01 CDT
Wheat prices have been on a wild roller coaster ride this spring and summer. The market has seen big swings of fifty cents or more in every two to three week period since April. On this weekend's edition of SUNUP, Oklahoma State University Grain Marketing Specialist Kim Anderson addresses the Kansas City wheat futures prices. Over the last two to three weeks, the September KC wheat contract has fallen sharply. Anderson said that contract has been trading from $4.95 to $6.11. He said right now the contract price has support at $5.06. If it breaks that level, he said the next target is $4.95, but if it breaks that level it could move into no man's land and the next target would likely be at $4.55. If wheat prices can move higher, he said there is resistance at $5.34 and $5.60.
The volatility of the market is being caused by several factors. Anderson said there is the political and financial volatility with Greece. As financial markets adjust, he said that forces the funds to pull money in and out of the commodities market. The strength of the U.S. dollar also isn't helping the situation. He said the value of the dollar is up around 97 points, which is relatively high. Plus, there are the fundamentals or supply and demand situation of the wheat market.
"We've got a pretty big carry over, we've got an adequate amount of wheat, we're probably going to have a surplus of wheat according to expectations, then you take the financial situation, the supply and demand situation, you've got the funds - billions of dollars moving in and out of the market and that gets you big price moves," Anderson said.
With so many factors influencing the market, Anderson said no one can predict where wheat prices will go. He recommends producers spread out their marketing of the crop by using the "dollar cost averaging" strategy in selling a little bit of the crop at a time.
This week on SUNUP, we join you from the 94th annual Oklahoma 4-H Roundup, where youth from all corners of the state come to the Oklahoma State University. We start the show with Extension equine specialist Kris Hiney explaining how to spot heat stress in horses.
- Also, Extension aquaculture specialist Marley Beem, has advice for growing fish population in ponds.
- In the Mesonet report, Al Sutherland and Gary McManus tell us if the past year is actually the wettest on record and what the recent cool front did for temperatures.
- In Cow-Calf Corner, Glenn Selk talks about why it is important to see if refrigerators are actually staying cold while holding medicine.
- Kim Anderson looks at the recent swings in the price of wheat and what it could mean for Oklahoma producers with over half of the world crop in the bins.
- Extension cotton specialist Randy Boman, has a reminder about the upcoming Oklahoma Irrigation Conference.
- Then, food industry economist Rodney Holcomb explains why a business plan is important to a startup as well as an established business, in Food Whys.
- Finally, see how Oklahoma 4-Her's are 'Building A Legacy' at Roundup 2015.
Join us for SUNUP: Saturdays at 7:30 a.m. & Sundays at 6 a.m. on OETA-TV
Catch SUNUP online through the OSU website by clicking here or through YouTube by clicking here.
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