Wheat pushed down through previous lows on Friday, and subsequently fell apart, closing 15-17 cents lower to levels not seen since Sep. 2006. September options expired on Friday, with heavy open interest in $4.00 KC and CHGO puts, leaving those that were short puts underwater and trying to trade around the position. Egypt’s GASC purchased 180 TMT of Russian wheat on Friday, at an average price of $185.50/MT C&F. The zero-tolerance policy on ergot was reinstated and implemented retroactively, which will have shippers concerned and likely push offers higher on future tenders. Cash markets saw continued support in rail values, as mills show continued interest to buy mid-11 pro and find a balance in the protein scale. Outside markets are helping the mover lower in grains, as USD is up 220 points and Crude Oil is down 60 points. Look for wheat to be the leader lower, as low prices try to reduce plantings this fall.
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