Hold On

We have done a number of stories lately about wheat and how there appears to be a huge surplus in recent times. Last year’s bumper crop added to that and let’s take into account what happened to this year’s crop. In a conversation with Blaine Jacobson, Executive Director of the Idaho wheat commission, he told me that this year’s crop was extraordinarily good, which led to the question from me, the future prices look good if people could just hold on to it. What are you hearing there? “I think there will be upward pressure on prices as the traders really evaluate the crop from elsewhere and as they get a better handle on inventories. I don't know that there is as much inventory out there as what is being reported. And a lot of the global inventory that is being reported is not in the market. It’s in places like China that won’t be trading it. The last I heard, the Canadian harvest, was running behind schedule. They were having some of the problems the decoders were having and might have a smaller crop than expected. Australia has been having some dryness problems. I think that once some of these factors work their way into the marketplace, there will be upward pressure on the prices. The hard red winter crop coming out of the Midwest is not terrific. Kansas had a lot of protein down in the single digits again.”

 

So Blaine’s advice… Hold onto it and see what happens.