Is it possible for wheat to rebound this year.So far there has been weather records broke this year going back as far as 40 plus years.Some of the southern hemosphere is %67 reliable at best.There is still rumors of qualitie being tight.This low is more of an possitioning than an actual!
I'd try to lock in 650 if you haven't already sold. The one thing that worries me about wheat prices, though, is that Brazillian farmers may move corn acreage to wheat if prices get too high, taking away a market for potentially 7 million metric tons per annum (about 257 million bushels, $1.5B USD), though this won't affect the current year. Seeing reports of only 42 million US acres planted, I can't help but think 650 is conservatively resonable, with potential for highs near 710 if we get some good news out of China.
Grow beans instead.
We are in a more typical corn/wheat ratio of 1.3-1.4 and it won't change. Previous values of wheat had insane ratios that were a blessing.
The natural question about Brazil producing more wheat is, why hasn't it produced its own wheat before when prices were higher?
I think the reason is that conditions for growing wheat aren't favorable in that climate and soil most of the time. Wheat there is a rotational crop in some areas in the winter where soil, temperatures and rotation timing make it a reasonable option.
Yes, it's possible ....
..... but one has to keep track of the dynamics and count the cards. Global stocks are not burdensome. Though not a huge market factor , Argentina has now confirmed their poor winter wheat crop again. Is the western drought going to grow and plague the Plains? This would be a good start but it bears watching. Very cold weather is often dry weather.
N American soft wheat is now priced lower than India's last deal and they are known for their poor quality. And their inability to make sales due to their policies and bureacracy that forces them to subsidize exports to maintain high domestic prices and production (long story).
Since the mention the world is 'awash in wheat' I now have much higher expectations in the future based on previous experience.
Re: Yes, it's possible ....
We went to San Antonio TX. To F.B.convention, and drove 1200 miles home this week up through TX. middle of OKLAHOMA and across MO. We talked to farmers at a cafe in Seymour TX., and asked them how last year was and they were very concerned about the moisture levels. They said the wheat crop was hurting, and that this was the 4th year in a row they were to dry. They were very depressed.The OK.wheat did not look any better either . We did see cows grazing in the wheat.