Increased Aussie Exports to Affect Wheat Futures

Australia’s largest grain handler predicts wheat shipments from their country is expected to increase by 13% for the 2013-14 marketing season.  Australia is the worlds third-largest wheat exporter, and the higher profits as of recent has encouraged more farmers to plant more wheat.

Wheat sales are expected to increase to as much as 18M metric tons (beginning fiscal year in November), compared to 16M m-tons exported this current year.  Wheat production, however, is slated to expand to 24M tons from 21.5M tons currently.

Early indicators are pointing to the second largest wheat crop on record.  Increased planting in Europe in response to higher 2012 (wheat futures) prices and a recent favorable outlook of the US recovering from a drought are all signs that point to a decrease in wheat prices,” said Jim Allen, licensed futures & Forex broker at Foremost Trading in Geneva IL, regarding the current wheat futures situation.  Allen added, “I am looking for a bearish (wheat futures) trend for 2013.”

Wheat futures trend is clearly down, with no clear bottom yet in sight.  I was stopped out of both wheat futures positions (entered today), but am looking to get back in the short side in the near future.

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