Anderson Reviews Grain Market Rally and Offers Harvest Price OutlookThu, 09 Jul 2015 17:38:55 CDT
Wheat, corn and soybeans have seen some positive gains in recent weeks. On this weekend's edition of SUNUP, Oklahoma State University Grain Marketing Specialist Dr. Kim Anderson provides the outlook for grain prices. The wheat market continues to be highly volatile. The Kansas City wheat futures contract has been trading from $5 to $6.11 a bushel. This past week, wheat traded from $5.74 to nearly $6.11. He said the price needs to break through the $6.11 level in order to move higher.
"If we can break that $6.11, which I think the odds are against that, then we would establish an uptrend," Anderson said. "Right now the market looks like we're just going to continue this sideways pattern, probably in a plus or minus 30 or 40 cents off the current price."
Corn prices has seen a significant rally. In looking at harvest delivery, Anderson said the Chicago Board of Trade contract prices for December are running from $3.63 to $4.40. He said this week corn had a support price around $4.20. The basis in central Oklahoma for harvest delivered corn is running around 25 cents below the December futures contract price for a cash price around $4.15 in central Oklahoma. The Panhandle region has a positive 25 cent basis, so cash prices are running around $4.65.
Soybean prices have rallied from $9 to about $10.40 in recent days. Anderson said soybean basis levels for harvest delivered beans across Oklahoma and the Texas Panhandle is running around 90 cents. With a November CBT price around $10, he said that makes the harvest delivered price $9.10.
In looking at sorghum, Anderson said the basis in central Oklahoma is running around minus ten cents, which equates to a harvest cash price of about $4.30. The sorghum basis in the panhandle is even, so Anderson said whatever the December contract price is for corn, then that is the forward contracted price for harvest delivered grain sorghum.
The rally has been stronger for corn and soybeans than for wheat. Anderson said if the prices can break through the top levels now, then the market can start an uptrend. He said this looks to more likely in soybeans and corn, than wheat. He thinks wheat will continue to trade sideways until August or September when wheat harvest gets underway in key wheat growing regions around the world.
You can listen to the full SUNUP interview by clicking on the LISTENBAR below.
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