The March contract amazing - up 2.50$ (~20%) since Jan 2nd. Now at 1296, making some wheat growers and traders very happy. Anyone catch this move, or know of a Minnesota wheat grower who did?
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Minneapolis Wheat
- Thread starter Nick Leeson Jr
- Start date
This is the 4th day in a row it has been limit bid at the open...not too many trades getting done.
Any shorts are getting creamed in that market as there has been no way to get out for several days. There are currently over 23,000 contracts of open interest in March Minneapolis wheat futures, while delivery stocks are only about 13 million bushels, or 2600 contracts. That leaves over 20,000 short contracts that in no way will be able to make delivery, and now they are being punished dearly with no end in sight.
Pretty simple-the wheat isn't there to back up the futures positions and now people are paying dearly. Spring wheat, which is traded in Minneapolis, is in the heat of the acreage battle with corn and beans. How high does Mpls wheat need to go to secure additional acres form corn and beans?? No one knows. Combine that with the squeeze play on the March contract and this will be one to remember.
Spring wheat is the highest in protein content amoing the wheat classes and suppplies are getting very tight, with millers turning to blending more KC wheat. The market has no choice but to secure acres for next year and price is the only way to accomplish that.
Any shorts are getting creamed in that market as there has been no way to get out for several days. There are currently over 23,000 contracts of open interest in March Minneapolis wheat futures, while delivery stocks are only about 13 million bushels, or 2600 contracts. That leaves over 20,000 short contracts that in no way will be able to make delivery, and now they are being punished dearly with no end in sight.
Pretty simple-the wheat isn't there to back up the futures positions and now people are paying dearly. Spring wheat, which is traded in Minneapolis, is in the heat of the acreage battle with corn and beans. How high does Mpls wheat need to go to secure additional acres form corn and beans?? No one knows. Combine that with the squeeze play on the March contract and this will be one to remember.
Spring wheat is the highest in protein content amoing the wheat classes and suppplies are getting very tight, with millers turning to blending more KC wheat. The market has no choice but to secure acres for next year and price is the only way to accomplish that.
4774 -- Where do you find delivery stock #'s?
DJ
DJ
thinking of going heavy selling a shit ton of march puts 16 days till exp. no way this fucker is slowing down they are gonna break the shorts, any thoughts? words of wisdom or warning lol??
1) Do a trade that has defined-risk, not potentially unlimited risk.
2) The exchange could declare a "liquidation only" market in order to facillitate the delivery of March-08. You'll probably be bankrupted with a short-put position that isn't far enough away.
3) The USDA could declare an export embargo that would probably scare the hell out of all of the longs. Your short-put position would become a nightmare.
4) Don't use market orders!
2) The exchange could declare a "liquidation only" market in order to facillitate the delivery of March-08. You'll probably be bankrupted with a short-put position that isn't far enough away.
3) The USDA could declare an export embargo that would probably scare the hell out of all of the longs. Your short-put position would become a nightmare.
4) Don't use market orders!