Economic Value Study Chicago wheat -10/02/2020

The accompanying scatter study displays the winter through spring high for soft red wheat in Chicago as a function of U.S. wheat carryout stocks as a % of crop year food use  and exports.

China, in the past a minor buyer of U.S. wheat has purchased nearly million tonnes of  wheat for  2020//21 delivery. The potential for U.S. exports beyond that included in the USDA September forecast seems limited. 

We have included a reduction in the 2020/21 wheat carryout due to the reduction in the wheat crop  estimate in the Small grains report  and have also assumed larger feed demand then USDA provided for when calculating the independent variable in our study. We expect a high for SRW wheat between $6.00 and $7.00.