Between the end of February and the middle of April, KC wheat was mostly rangebound between the mid-590s on the topside and mid 550s down low, with little to move prices higher, all the while Managed funds continued adding to their large net short positions. Toward the end of April, dryness in the Black Sea region and the US HRW growing areas started becoming more concerning and triggered a short covering rally across the wheat complex, driving prices to levels not seen in over six months. Although US wheat exports continue to struggle to compete on the world market, which can keep a lid on US prices, the recent breakout above resistance from the December highs suggests there is potential for a test of the highs from last summer.

• No new action is recommended for 2023 KC wheat. Any remaining 2023 hard red winter wheat should be getting priced into market strength. Grain Market Insider won’t have any “New Alerts” for 2023 KC wheat – either Cash, Calls, or Puts, as we have moved focus onto 2024 and 2025 Crop Year Opportunities. 
• No new action is recommended for 2024 KC wheat. Considering the recent upside breakout in KC wheat, we recommended buying upside July ’25 860 and 1020 calls (for their extended time frame) in case of a protracted rally. Our current strategy is to target 820 – 840 versus July ’24 to recommend further sales and to target a selling price of about 71 cents in the 860 calls to achieve a net neutral cost on the remaining 1020 calls. The remaining 1020 calls would then continue to protect existing sales and give you confidence to make additional sales at higher prices.
• Grain Market Insider recommends buying July ‘25 620 KC wheat puts on a portion of your 2025 HRW wheat crop for approximately 30 cents plus commission and fees. The 706 support level in July ‘25 KC wheat futures has been broken. The market closing below 706 now paints a very uncertain picture for the overall direction of the market. The upside breakout in late May suggested that the macro trend had turned higher for wheat, with an overall higher trend possible into next year. If the overall macro trend was indeed up, we expected 706 support to hold. Therefore, this break of support raises the question of whether the upside breakout in late May was a false breakout or not. Given the market’s higher volatility and uncertain global picture, we want to maintain the July ’25 call options that are in place for the 2024 crop, and now add July ’25 put options for downside coverage on the 2025 crop. Adding put options now creates a “Strangle” option strategy, which is comprised of long calls and long puts in the same option month. This strategy is beneficial when market direction becomes uncertain, yet the expectation is for a future large move. From the current price level, if the macro trend is indeed up, a move to 800+ looks possible on the topside, and if the macro trend is down, then a move back to 550 or lower looks possible on the downside.

To date, Grain Market Insider has issued the following KC recommendations:

Above: Following the bearish reversal in late May, prices have trended lower, and they appear on track to test the 660 – 646 support area. If this area holds and prices rebound, they may encounter resistance 728 and 746. Otherwise if they break further, potential support could come in between 625 and 620.