Commercial buying has the Chicago wheat market higher to start the week, which can mostly be attributed to the worsening conditions of the European crop. The CFTC COT report showed funds kept positions flat during the week ending 8/2, while estimates showed the net short increased by 10k contracts. The market was expecting to see confirmation of a new record short, but we are still near the current record. Brazil may be setting up to reduce the import tariff on wheat, as they work to cover needs with much of the domestic supply going into feed rations. Interior cash values have been mostly steady, but new export business should open up demand for Sep. through Dec. The USD is 150 points higher, but Crude Oil is 75 higher and equities are also higher. Look for KC wheat to follow along with strength in Chicago wheat and soybean export demand.
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