wmeubank@ocp.kcmo.com
ALLENDALE, INC.
4506 Prime Parkway, McHenry, Illinois
(November 24, 1997) WHEAT: Last year we said that USDA policy was bearish. In less than 2 months, the wheat price has fallen from profitable prices to a very unprofitable prices for many of our U.S. farmers. The northern Plains will likely seek alternative crops. Thus the market has done its job. It is now at a price that end users can buy at below the cost of production and this should increase the demand curve. It has also fallen to levels that will shift the supply curve back to lower levels. The end result will be higher prices. Now timing is the key. When do the futures give you a signal to buy? Long-term bottoms often build a “saucer bottom” or rounded bottom. It appears that the weekly chart is starting to show signs of this. It will take time but should be solid once completed.
Bill Biedermann
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