July 08 is new crop month. The wheat that is about to be planted now. Everybody and his brother will be planting wheat
it all hinges on australian supplies, which are going to be pretty lousy. just for perspective, on profitability of crops (from some old data i quickly googled, but I'm sure the yields are similar): http://www.nass.usda.gov/census/census02/volume1/us/st99_1_033_033.pdf 71.4 bushels/acre for wheat 42.9 bushels/acre for soy 159 bushels/acre for corn So at current prices: 71.4 * 9.30 = $664/acre for wheat 42.9 * 9.93 = $425/acre for soy 159 * 3.90 = $620/acre for corn and cotton: 2.1 bales/acre. 500 lbs/bale. 1050 x .6615 = $694/acre http://www.aragriculture.org/crops/cotton/comments/Cotton_Comments_01_07.pdf If I were a farmer, I'd probably be planting less soy next season and gunning for the cotton and wheat.
framers can squeeze two crops of soybeans in one year, so beans do bring in the most revenue. Beans also are the lowest cost to grow,less fertilzer easier to harvest.
Of all the times to go short, the late blowoff/momentum stage of a confirmed bull market is probably the most dangerous. You are liable to get your ass handed to you if your timing is anything less than impeccable. If you must top-pick, surely it's better to wait for a clear reversal signal e.g. vol spike/sentiment extreme, and a gap'n'crap or clear reversal day to signal that the top may be in. I don't think we are there yet in wheat. Support was made around 825-830 and now it's at new record highs. IMO long is the side to play, next stop 1000.
Be very careful shorting this market at the moment as so many things are against you with $ weakness also a driver here
i use IB and, in looking at the various options chains on the different wheat contracts, i do not see ANY volume- ie: zero. could you direct me to any wheat contracts that actually trade- i assume i'm missing something...
If I understood correctly, you're short from 900. Last nite's low was 835. I hope you don't mind me asking ... Are you still in? If yes, please share with us why ... just curious.