CROPS

The wheat market, hostage this summer to drought in the corn belt, has returned to trading day-to-day on current events such as export sales (or lack thereof).

Chicago wheat prices have declined as much as 90 cents per bushel in the few sessions since Aug. 10, but Tuesday's Egyptian purchase of 120,000 tonnes of wheat was from Russia and the Ukraine, only three days after a previous large Russian wheat sale to Egypt. Clearly U.S. wheat offers were too high. Apparently the earlier talk of Russian export restrictions was premature, even though it is known that their drought-reduced har- vest is expected to be as much as 20 percent lower than last season. The cure for high prices is high prices.

The background markets, currencies, crude oil, stock indices or metals, are all in a quieter mode this week, so their influence on grains is muted. The trend line for U.S. stock markets is in a flat pattern, unable to break to new highs for seven trading sessions since last Monday. The stock markets will become vulnerable to a short-term break downward if no new highs emerge within a few days or a week, but barring a "discontinuous event" the most dominant influences are not large.

The U.S. dollar, still a haven of safety when the world is seeking refuge in times of stress, is not being pushed upward by fear and flight from other currencies as it has often been of late. Crude oil is trading a narrow path between $90 and $95 per barrel for the last week, well above the low seen in the last week of June near $77 per barrel, but also far from the $110 highs of February. The metals are barely even in the news, with gold essentially flat since May around the $1,600 mark. European risk is not eliminated, but until U.S. elections are completed and new influences emerge, it is likely to be quiet.

Wheat markets seem likely to be range-bound for a bit, with no new incentive to run to the up- side. There are a few lower technical targets on the wheat charts that have yet to be achieved, sug- gesting at least another potential 25 cents lower, but these are always optional, as every price move in either direction can always be projected farther.

Overall not an easy environment in which to trade, but the fear factor is lower than it has been for weeks.

Information and opinions contained herein come from sources believed to be reliable, but are not guaranteed as to accuracy or complete- ness. The risk of loss in trading futures and/or options is substantial. Each investor must con- sider whether this is a suitable investment. When trading futures and/or options, it is possible to lose more than the full value of your account. All funds committed should be risk capital.