The deterioration of crops because of dry weather in the U.S. and rain delays in regions of Europe drove the grain higher on Wednesday. Nearly 40 percent of the winter crop of wheat in the U.S. either was in good or excellent condition as of this past Sunday, according to the U.S. Department of Agriculture.
"In the U.S. Plains, they're going into dormancy in very dry conditions," risk-management consultant Mike O'Dea with INTL FCStone in Missouri told the news source on Wednesday, noting increases to French prices "will give the impression that U.S. grain is undervalued compared to the world market."
At 11:46 a.m. on Wednesday, wheat futures gained 1.97 percent, a 0.1725 cent gain to $8.9425 per bushel.
Reuters reports the grain has increased in value five consecutive days as losses to the shared currency of the European Union kept optimism high for prospects of wheat exports from Europe.
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.
Past performance is not necessarily indicative of future performance. The risk of loss in trading futures contracts or commodity options can be substantial, and therefore investors should understand the risks involved in taking leveraged positions and must assume responsibility for the risks associated with such investments and for their results.
Trade recommendations and profit/loss calculations may not include commissions and fees. Please consult your broker for details based on your trading arrangement and commission setup.
You should carefully consider whether such trading is suitable for you in light of your circumstances and financial resources. You should read the "risk disclosure" webpage accessed at www.DanielsTrading.com at the bottom of the homepage. Daniels Trading is not affiliated with nor does it endorse any third-party trading system, newsletter or other similar service. Daniels Trading does not guarantee or verify any performance claims made by such systems or service.