Indonesian Imports Seen Positive for Wheat Futures

The country of Indonesia is expecting a 6% increase in wheat and by-product imports this year as they are experiencing a rise in income, and with it, food demand.  Indonesia’s demand for imports is said to have have risen 50% in just the past decade and is currently Asia’s biggest importer.

The USDA has reported wheat production surging to record heights causing global inventories to reach a 12-year high, but a steady increase of recent purchases can halt the 11% slump in wheat futures this past year.  The top three exporters of wheat are the USA, Australia, and Russia.

Fresh demand news is needed to propel wheat higher.  With a lack of such news, wheat will continue to trade in this consolidation range.  Support will come from the bullish strength in soybeans,” stated Kevin Craney, a senior commodities broker with RJO Futures in Chicago, regarding the current wheat futures situation.

Wheat futures are technically in an uptrend, but looking at the daily and weekly charts they have been trading absolutely sideways.  A breakout is imminent – one way, or the other – but my guess is it will be to the downside.  I am treading carefully in this market.

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