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April 1, 2011

(See attached file: PR 110401.pdf)(See attached file: PR 110401.xls)

Highlights:
  • Futures traded higher this week following the release of USDA’s Prospective Plantings and Grain Stocks reports. Corn led the rally after USDA pegged corn stocks as of March 1, 2011 at 166 MMT, a 15 percent decline from last year and below trade estimates of 170 MMT. Wheat followed corn’s lead, with the CBOT May contract posting a 36-cent gain on Thursday. Overall, the CBOT May contract was up 26 cents from a week ago, closing at $7.59/bu. With ongoing dry conditions hampering HRW crop development and concerns that flooding may delay spring wheat plantings, both KCBT and MGEX nearbys were up sharply this week. The KCBT May contract gained 51 cents from a week ago, closing at $9.06/bu, while the MGEX May contract gained 41 cents, closing at $9.22/bu. Following the tight stocks reported by USDA, corn prices gained their 30-cent limit on Thursday, and posted a 42-cent gain on Friday. Overall, the CBOT May corn contract gained 46 cents from last week, closing at $7.36/bu. Soybean prices were also higher after USDA reported lower-than-expected stocks, gaining 35 cents from last week and closing at $13.93/bu.
  • USDA released their Prospective Plantings report on Thursday. The report estimated 2011 U.S. wheat acreage at 58.0 million acres, up eight percent from 2010. Winter wheat acreage stood at 41.2 million acres, up 10 percent from last year, while spring wheat acreage was up five percent, to 14.4 million acres. Estimated durum acreage was down from last year, falling by eight percent to 2.37 million acres. Corn planted area was up five percent, to 92.2 million acres, while soybean planted area was down one percent, to 76.6 million acres.
  • USDA’s Grain Stocks report was very bullish for corn, with USDA reporting corn stocks in all positions at 166 MMT, down 15 percent from a year ago. USDA reported wheat stocks in all positions at 38.6 MMT, up five percent from last year. Soybean stocks were down two percent, to 34.0 MMT.
  • Ukraine announced it will extend its grain export quotas until July 1, 2011. The quotas were set to expire this week, on March 31. No changes were made to the wheat export quota, which currently allows for 1.0 MMT of wheat for export. Ukraine increased their allowable corn exports from 2.0 MMT to 5.0 MMT.
  • FOB soft red winter basis out of the Gulf was higher this week due to higher barge rates and limited grain movement. FOB SRW stood at $1.15/bu for May delivery, compared to $1.10/bu a week ago.
  • The CBOT corn/wheat spread narrowed considerably this week due to large gains in corn futures. The spread stood at $0.23/bu on Friday, compared to $0.44/bu last week. The spread has steadily narrowed since the beginning of February when it stood at over $2.00/bu.
  • The Baltic Panamax Index (BPI) was down again this week as an excess of tonnage weighs on the market. The BPI fell to 1,925 on Friday, down from 2,078 last week and reaching its lowest point since early March.

File Name
PR 110401.pdf
PR 110401.xls
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