Market Perspective

The rally in the wheat market marches on as the two main reasons for this contra seasonal rally continue to support prices. First, the drought and now record high temperatures in the Southern Plains continue to stress the winter wheat crop there and second, the conflict in the Ukraine continues to intensify. Both stories now have the full attention of the market. Speculative funds, who not too long ago held a record short position in Chicago wheat, are now net long about 100 million bu., heading into this Friday's USDA Crop Production Report.

On Monday, the USDA Crop Progress showed the overal...