Turner’s Take Podcast | 2021-2022 Wheat Ideas
Turner's Take Podcast

Play Turner’s Take Ag Marketing Podcast Episode 252

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This week we go over our thoughts on wheat for the rest of this year and 2021.  Wheat will most likely be a follower of corn and soybeans.  We see SRW stocks building next year while HRW stocks declining. KC could trade over Chicago wheat in the 2021-2022 marketing year.  Currently front month KC is 60 yo 70 cents under Chicago.  We can KC eventually trade over Chicago in 2021.  If you want to know more then make sure you take a listen to this week’s Turner’s Take Podcast

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Wheat

For the 2021-22 marketing year we see SRW wheat acres 6mm and HRW acres about 21.5mm acres.  That is an increase of almost 1mm SRW wheat acres but HRW stays about the same.  The increase in acres for the Chicago contract should bring soft red winter wheat ending stocks up to around 135mm bushels, which increases stock/usage from 38% to 45%.  This will most likely be a bearish factor for SRW (Chicago) Wheat.

HRW (KC) will most likely see a draw on stocks.  A few years ago stock/usage for HRW wheat was over 60%.  Now we see it about 35% for the 2021-2022 marketing year.  If corn and soybeans stay elevated (above $4 and $10 respectively), it is possible KC wheat could be $6 and Chicago in the mid $5s.

Our best bet for wheat in 2021 is KC gaining on Chicago.  After years of burdensome KC stocks and tighter Chi stocks, we see that trend reversing.  Right now Dec KC trade 60 to 70 cents under Chicago.  We think the July 21 spread can get close to parity and the Dec 21 spreads have KC eventually 20 cents over Chicago.

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Dec 2020 KC vs Chicago Wheat (OLD CROP)

July 2021 KC vs Chicago (NEW CROP)

About Turner’s Take Podcast and Newsletter

If you are having trouble listening to the podcast, please click here for Turner’s Take Podcast episodes! Craig Turner – Commodity Futures Broker 312-706-7610 cturner@danielstrading.com Turner’s Take Ag Marketing: https://www.turnerstakeag.com Turner’s Take Spec: https://www.turnerstake.com Twitter: @Turners_Take Contact Craig Turner

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This material is conveyed as a solicitation for entering into a derivatives transaction.

This material has been prepared by a Daniels Trading broker who provides research market commentary and trade recommendations as part of his or her solicitation for accounts and solicitation for trades; however, Daniels Trading does not maintain a research department as defined in CFTC Rule 1.71. Daniels Trading, its principals, brokers and employees may trade in derivatives for their own accounts or for the accounts of others. Due to various factors (such as risk tolerance, margin requirements, trading objectives, short term vs. long term strategies, technical vs. fundamental market analysis, and other factors) such trading may result in the initiation or liquidation of positions that are different from or contrary to the opinions and recommendations contained therein.

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About Craig Turner

Craig Turner is a Senior Broker at Daniels Trading, author of Turner’s Take newsletter, and a Contributing Editor for Grain Analyst. Craig is often quoted in the Wall Street Journal, Reuters, Dow Jones Newswire, Corn & Soybean Digest, and also makes appearances on SiriusXM – Rural Radio Channel 80 providing commentary for the Grain and Livestock markets. Craig has also been featured in FutureSource’s Fast Break series, Futures Magazine Online, and INO.com. Mr. Turner has a Bachelors from the Rensselaer Polytechnic Institute (RPI) where he graduated with honors and has worked at the NYSE and Goldman Sachs. While at Goldman, Craig earned his MBA in the NYU Stern executive program. Learn more about Craig Turner.