Wheat Facing Friday AM Weakness

Wheat futures were mixed and opened lower Friday after modest Thursday moves—Chicago SRW up 3–4¢, KC HRW and MGEX largely flat to down—with December contracts expiring and open interest rising across contracts. USDA weekly export sales hit 850,418 MT for the week ended 11/13 (a six‑week high, +54.7% y/y) and accumulated commitments stand at 18.12 MMT (+22.4% y/y, the largest for that week since 2013/14); Census data showed September shipments of 3.23 MMT (a 12‑year high, +19.97% vs. August) and a private South Korean purchase totaled 65,000 MT. These demand metrics suggest underlying support for wheat prices even as near‑term futures trade in a narrow, mixed range ahead of the December expiry.

Analysis

Wheat futures opened lower Friday after mixed Thursday action with Chicago SRW futures up 3–4 cents, KC HRW showing small penny losses in front months, and Minneapolis spring wheat largely flat; December futures expire on Friday and front-month Dec 25 CBOT closed $5.34 1/2 (up 3 1/4¢), Mar 26 CBOT closed $5.33 1/2 (up 4¢) while Dec 25 KCBT closed $5.15 1/2 (down 1¢) and MGEX Dec 25 was $5.82 1/2 (unch). Open interest rose materially ahead of expiry, with Chicago OI up 4,003 contracts and KC OI up 3,610 contracts, suggesting active positioning into the roll.

Fundamental demand metrics show clear upside support: USDA weekly export sales were 850,418 MT for the week ending 11/13 (a six‑week high, +54.73% y/y), accumulated commitments are 18.12 MMT (+22.4% y/y and the largest for that week since 2013/14), and September Census shipments were 3.23 MMT (118.68 mbu), the largest September in 12 years and +19.97% versus August. A private overnight purchase by a South Korean importer for 65,000 MT adds a discrete bid.

Implication: strong export demand and rising shipments provide fundamental support to prices even as near‑term futures trade in a narrow, mixed range into expiry, but the December settlement and potential rolling flow create event risk and could amplify volatility. Monitor weekly USDA reports, OI trends and booking/shipments for confirmation; absent further demand deterioration or big speculative liquidation, the balance tilts toward constructive near‑term price bias but with execution risk around the expiry window.

Key Decisions for Investors

• Trim or avoid aggressive near‑term directional positions into the December expiry given mixed front‑month action and potential roll/expiry volatility
• Consider modest long exposure to wheat futures or related equities given strong demand signals — 850,418 MT weekly sales (+54.7% y/y), accumulated commitments 18.12 MMT (+22.4% y/y) — but scale in to manage risk
• Monitor weekly USDA export sales, Census shipment data and open interest (OI up notably on Thursday) and be prepared to hedge or reduce exposure if sales momentum or OI reverses