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Wheat Prices: No Rebound In Sight

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Wheat Prices: No Rebound Insight


WHEAT:If youre thinking that after all the calm over the past several weeks we may finally get a rebound in Wheat prices; you better think again. With worldwide Wheat acreage sowings expected to be up, my estimates for next years yields i.e. 2018 havent change. Moreover, my planting estimates were revised upward a couple of weeks ago as a result of my channel checks. I still remain somewhat bearish on this beautiful commoditys price heading into next year with a harvest factor of 1.10 domestically, when compared to this years harvest. Where I dont put any stock into the US Department of Agricultures WASDE supply and demand crop report, it will be interesting as to what their language reads in the next report. The markets are simply looking for direction and any clue to information that may, I repeat may, impact the price going forward. Whatever it reads will be short lived, however. Also, bear in mind that the premium between the hard red winter Wheat and soft red winter Wheat is still around parity. What we would like to see is hard Wheat to trade a premium to soft Wheat give its protein superiority. However, this is not the case suggesting that prices over the near term may remain subdued.

In short, my 2018 Wheat price estimate still remains around the 360ish level. I have a cautious sell on Wheat. Farmers, its not too late to lock in a hedging strategy for next years crop, so give me a call. I have a strategy that could benefit you.

MORNING CALL and Recommendation:

We are Short @KW given both Algorithms point to the upside.


Short: @KW (Hard Red Winter Wheat)

Price: 434.25 (10/19/2017) (continuous contract; contract adjusted)

Current Price: 429.75 (11/6/2017, 9am CST)


+247.75 (as of January 2nd, 2017; per 1 contract)


For farmers/producers looking to put on a hedge please give me a call for a no obligation free quote. Ill be more than willing to visit your farm and explain how a hedge works, obviously at not costs to you. Please visit our website: www.royalhighlandadvisors.comor call me at 920-319-1444. Email:,,

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About the author

Phil McKnight has a Bachelors Degree in Accounting from the University of Arkansas (Fayetteville), a Masters in Business Administration from Northeastern University, a PostGrad Diploma in Personal Financial Planning from the University of California (Los Angles, UCLA), and a PhD in Finance from the University of Bath (England, UK). Phil graduated with distinction/summa cum laude from UCLA.

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