T & K Futures and Options Believes That Wheat Futures Prices May Break Through $9 If Bad Weather Persists.

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The sudden indication that Russia, Canada, France Hungary and may others may show a loss of tens of millions of tons of supply because of unusually hot weather in Europe and Asia and unusually wet weather in Canada sent investors scrambling to get on the long side of the wheat futures markets.

The recent run up in wheat futures prices is one of the largest one month increases in history. Wheat futures prices rose over 50% from the last week in June through the August second high. Wheat prices may run even further as many traders were caught short in this down trending market with ample global supplies. The sudden indication that Russia, Canada, France Hungary and may others may show a loss of tens of millions of tons of supply because of unusually hot weather in Europe and Asia and unusually wet weather in Canada sent investors scrambling to get on the long side of the wheat futures markets. Visit http://www.tkfutures.com/wheat.htm to learn more about trading wheat futures and options.

Many importers may look to lock in prices now just in case prices move even higher. Egypt buys almost all of its wheat from Russia because of cheap shipping rates in that region of the world. The necessity for the world's largest importer of wheat to diversify its wheat suppliers may push demand towards the European Union, the United States or Australia. A recent export sales report from the USDA at the end of July showed Egypt as a buyer of U.S. wheat. Brazil is the second largest importer of wheat and typically buys its wheat from Argentina. Argentina recently when through a severe drought that reduced it wheat yields forcing Brazil to seek out other wheat suppliers. Visit http://www.tkfutures.com/education.htm to learn more.

In 2007 and 2008 food inflation was rampant as wheat futures prices rocketed up through $13 a bushel and corn futures prices went through $7.50 a bushel. Importers and exporters of corn and wheat may be pushed to boost strategic reserves of these grains just in case a 2007 and 2008 type food inflation scenario occurs again this year. Visit http://www.tkfutures.com/corn.htm to learn more about corn futures and options trading.

The author of this article is a 16 year veteran of the wheat futures and options markets and the president of T & K Futures and Options, Inc. Futures, options and foreign exchange investments carry significant risk of loss and only risk capital should be used for this type of investment. Past performance is not indicative of future results.        

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MICHAEL SMITH
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