Wheat Markets
The attempt by the government to regulate and interfere with the wheat market could be another disaster in the making, as the completely foolish, misguided and clueless Democrats continue their assault on free markets.
According to Charles Carey, vice chairman of CBOT owner CME Group Inc., government restrictions on trading "are more likely to be harmful to the functioning of our markets than helpful," and he's absolutely right.
The idea that we should have some type of perfection in place so no one ever gets hurt is outrageous, socialist and fascist to the core. Short term fluctations in wheat prices will never last, and that's the illusory problem the goofy Democrats think needs to be solved.
Unbelievably, federal regulators are "seriously considering" restrictions in the wheat futures market being urged by lawmakers concerned over speculation they say has artificially inflated prices, supposedly interfering risk management by farmers and grain processors.
After a wasted year and time, a faux investigation by the investigative panel of the Senate Homeland Security and Governmental Affairs Committee found that the disconnect between the wheat futures and cash markets can mean higher prices for consumers. They say this with a straight face when corn prices and lack of planting of wheat does more to jack up the prices because of other government interference through subsidies from taxpayers dollars.
A number of senators have called on the Commodity Futures Trading Commission to restrict the volume of index trading in the wheat futures market on the Chicago Board of Trade, a completely ridiculous idea.
Foolishly, CFTC Chairman Gary Gensler told the Senate subcommittee at a recent hearing that the agency "is seriously considering this recommendation ... (and) will continue to closely monitor the performance of the wheat futures contract."
Democrat Panel chairman Carl Levin, ignorantly said such a review "is badly needed." Several other members of the committee, representing farm states, voiced concern about the impact of market problems on wheat producers in those states.
Again, to me much of this is to hide the real culprit in wheat prices, federal subsidies of corn for the failing corn-based ethanol industry, which is pushing up prices because of less acreage used for wheat because of the artifical price increases created by the U.S. government.
But an official of the company that operates the Chicago Board of Trade, where wheat futures are traded, opposed such constraints and disputed the Senate probe's findings, as mentiond above from Charles Carey's accurate comments.
The idea of attempting to manipulate the market by the U.S. government and Democrats will fail, as the utopian idea of reducing risk is completely foolish and always fails, and the wheat and commodities markets overall will suffer.
Commodity indexes include futures contracts for delivery in different months. Commodity index traders sell financial instruments whose values rise and fall along with the value of the index on which they are located.
Commodity index traders acquire wheat futures to help offset their risk from selling the instruments to third parties. That pumps billions of dollars into the market and lifts demand and prices for wheat futures, the faulty results of the Senate investigation found.
Other related to the risk factors are also whining about the alleged discrepencies, as one person representing the American Bakers Association and the Sara Lee Corp said at the hearing, "Bakers cannot escape the impact. Today's volatility represents millions of dollars daily in undue financial risk."
What this disingenous bureaucrat doesn't say is this has always been the case, and the those that manage this risk factor are the ones who win. In the stimulous and spirit of bailing out company after company, those that can't compete are attempting to make it look like something unusual is happening, when in fact it has been the practice and way of doing business for a long time.
The one who knows about this the best is Charles Carey, vice chairman of CBOT owner CME Group Inc., and he concludes that the findings of the Senate report "are based on faulty economic analysis and a misunderstanding of basic market economics."
Just look at what the Democrats and Obama are doing to destroy America with its socialist and fascist policies, and you can easily understand how this group of politicians are among the most inexperienced and naive in American history; in both foreign and domestic policy, and they need to just shut up and let the free market work things out, which it always has done.
Wheat Markets
Showing posts with label Wheat CBOT. Show all posts
Showing posts with label Wheat CBOT. Show all posts
Tuesday, July 21, 2009
Monday, January 12, 2009
Wheat Prices Fall to Exchange Limit on Rising Supply
While wheat didn't revise estimates near as much as corn, global projections still rose 0.7 percent to 148.4 million metric tons by the close of the marketing year on May 31, according to the USDA.
Estimates are there will be a surplus of U.S. wheat of 655 million bushels - an increase of 5.1 percent - by May 31. That will be over double the 306 million bushels available last year.
December wheat inventories in the U.S. increased by 26 percent to 1.422 billion bushels on December 1, a 26 percent increase over last year's 1.132 billon bushels.
Wheat futures for March delivery dropped 59.75 cents, or 9.5 percent, to $5.6975. Earlier in the session it dropped to its 60 cents limit.
From September to December, farmers planted 42.098 million acres, down from the 46.281 acres in 2007.
Estimates are there will be a surplus of U.S. wheat of 655 million bushels - an increase of 5.1 percent - by May 31. That will be over double the 306 million bushels available last year.
December wheat inventories in the U.S. increased by 26 percent to 1.422 billion bushels on December 1, a 26 percent increase over last year's 1.132 billon bushels.
Wheat futures for March delivery dropped 59.75 cents, or 9.5 percent, to $5.6975. Earlier in the session it dropped to its 60 cents limit.
From September to December, farmers planted 42.098 million acres, down from the 46.281 acres in 2007.
Sunday, December 21, 2008
Cold Weather Drives Up Weekly Wheat Prices
With the bulls concerned over the first strong cold weather of the season possibly may damage the dormant wheat crops, prices for the week ended up.
Even though Friday prices were softer, the overall week had KCBT wheat rising by 44.75 cents to $5.83 a bushel, MGE grew by 35.25 cents to $6.2525 a bushel and March CBOT led them all, gaining 50.25 cents to finish the week at $5.6325.
Although there was worries over the weather, a number of meteorologists suggested the cold spell probably wouldn't do enough damage to the crops to make much of a difference. Even so, prices rose on the possibility.
Weather will be especially rough in the central and southern Plains, with below-zero forecasts in the mix. Some of the concern was directed to areas that had little or no snow to protect from the bitterly cold temperatures.
Of course it won't be known until the spring if the dormant crop really had any damage to it, so it's a wait-and-see game at this time.
Spring wheat traded on the MGE hasn't been planted yet.
Even though Friday prices were softer, the overall week had KCBT wheat rising by 44.75 cents to $5.83 a bushel, MGE grew by 35.25 cents to $6.2525 a bushel and March CBOT led them all, gaining 50.25 cents to finish the week at $5.6325.
Although there was worries over the weather, a number of meteorologists suggested the cold spell probably wouldn't do enough damage to the crops to make much of a difference. Even so, prices rose on the possibility.
Weather will be especially rough in the central and southern Plains, with below-zero forecasts in the mix. Some of the concern was directed to areas that had little or no snow to protect from the bitterly cold temperatures.
Of course it won't be known until the spring if the dormant crop really had any damage to it, so it's a wait-and-see game at this time.
Spring wheat traded on the MGE hasn't been planted yet.
Monday, October 6, 2008
US Wheat Plunges on Economic Fears and Pressure
Commodities continue to take a beating as the markets worldwide become under increasing pressure. Wheat suffered along with most others as they tumbled on all the exchanges.
Along with the economic conditions, other factors were the stronger U.S. dollar and the drop in price of soybeans and corn. A stronger U.S. dollar makes investments in commodities less attractive to foreign traders.
The outlook for 2008 through 2009 looks somewhat grim for wheat, as outside pressures of the global economy continue and the projected record wheat crop drives prices further down.
Along with U.S. wheat production, Canada is raising its wheat production forecast, as are many other countries.
Much of that is because of increased number of acres being planted in wheat as well as expected good weather conditions.
On the Chicago Board of Trade December wheat dropped by 45 cents to $5.95 1/4 a bushel for December. December wheat on the Kansas City Board of Trade fell 42 1/4 cents to $6.28 1/4 a bushel, while December wheat declined by 38 cents to $6.64 3/4 on the Minneapolis Grain Exchange.
Along with the economic conditions, other factors were the stronger U.S. dollar and the drop in price of soybeans and corn. A stronger U.S. dollar makes investments in commodities less attractive to foreign traders.
The outlook for 2008 through 2009 looks somewhat grim for wheat, as outside pressures of the global economy continue and the projected record wheat crop drives prices further down.
Along with U.S. wheat production, Canada is raising its wheat production forecast, as are many other countries.
Much of that is because of increased number of acres being planted in wheat as well as expected good weather conditions.
On the Chicago Board of Trade December wheat dropped by 45 cents to $5.95 1/4 a bushel for December. December wheat on the Kansas City Board of Trade fell 42 1/4 cents to $6.28 1/4 a bushel, while December wheat declined by 38 cents to $6.64 3/4 on the Minneapolis Grain Exchange.
Friday, September 26, 2008
US Wheat Follows Other Commodities Down
With no fresh news on underlying wheat fundamentals, the grain followed other commodities down based on the unsurety of the economic bailout of the financial sector in the U.S.
December wheat at the Chicago Board of Trade fell by 20 1/4 cents to $7.16 a bushel as investors held back with the weekend coming up and the economic uncertainty.
The Kansas City Board of Trade followed suit as it came under pressure as well. December wheat fell by 19 1/2 cents to $7.16 a bushel.
There were also concerns about demand needing to increase after Egypt and Iran decided to acquire wheat from Russia this week.
As usual, the Minneapolis Grain Exchange followed in the footsteps of its CBOT cousin, also experiencing a decline to $7.89 3/4 a bushel, a 16-cent fall.
Traders are looking for direction from the quarterly grain stocks and small grain reports by the U.S. Department of Agriculture at 8:30 a.m. EDT Tuesday. Although an estimate, it'll help give a better picture on the actual usage of the grain.
It is thought at this time that the report will say wheat production for August fell from the expected 2.462 billion bushels originally estimated to 2.459 billion bushels.
December wheat at the Chicago Board of Trade fell by 20 1/4 cents to $7.16 a bushel as investors held back with the weekend coming up and the economic uncertainty.
The Kansas City Board of Trade followed suit as it came under pressure as well. December wheat fell by 19 1/2 cents to $7.16 a bushel.
There were also concerns about demand needing to increase after Egypt and Iran decided to acquire wheat from Russia this week.
As usual, the Minneapolis Grain Exchange followed in the footsteps of its CBOT cousin, also experiencing a decline to $7.89 3/4 a bushel, a 16-cent fall.
Traders are looking for direction from the quarterly grain stocks and small grain reports by the U.S. Department of Agriculture at 8:30 a.m. EDT Tuesday. Although an estimate, it'll help give a better picture on the actual usage of the grain.
It is thought at this time that the report will say wheat production for August fell from the expected 2.462 billion bushels originally estimated to 2.459 billion bushels.
Wednesday, August 6, 2008
CBOT September Wheat Drops 14 1/4 cents to $7.65 3/4 a Bushel
Even though wheat partook in the plunge in prices of crop cousins soybeans and corn, it still held up pretty good taking all factors into consideration.
September wheat on the CBOT dropped by 14 1/4 cents to $7.65 3/4 a bushel, while Kansas City Board of Trade September wheat dropped 10 1/2 cents to $7.96, and Minneapolis Grain Exchange September wheat rose 1/2 cent to $8.53 3/4.
There were about 3,000 wheat contracts that sold on the CBOT today.
"I think, technically, it's acting fairly well," Alan Brugler, president of Brugler Marketing & Management, said of wheat. "I would attribute most of the selling to fund-type liquidation."
As far as their companion crops, November soybeans fell 47 cents to $12.22, while December corn declined 17 1/4 cents to $5.27 3/4.
September wheat on the CBOT dropped by 14 1/4 cents to $7.65 3/4 a bushel, while Kansas City Board of Trade September wheat dropped 10 1/2 cents to $7.96, and Minneapolis Grain Exchange September wheat rose 1/2 cent to $8.53 3/4.
There were about 3,000 wheat contracts that sold on the CBOT today.
"I think, technically, it's acting fairly well," Alan Brugler, president of Brugler Marketing & Management, said of wheat. "I would attribute most of the selling to fund-type liquidation."
As far as their companion crops, November soybeans fell 47 cents to $12.22, while December corn declined 17 1/4 cents to $5.27 3/4.
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