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February 26, 2016
  • A stronger U.S. dollar and an ample global wheat supply pushed markets to multi-year lows this week ahead of the USDA Agricultural Outlook, which supplied limited support due to expected reductions in 2016/17 U.S. wheat planted area and production. Commodity funds continue to hold large net short positions in wheat. CBOT March wheat fell 19 cents to $4.43/bu, KCBT lost 14 cents to $4.42/bu and MGEX dipped 3 cents this week to $4.89/bu. CBOT March corn dropped 11 cents to $3.54/bu and March soybeans decreased 23 cents week over week to $8.55/bu.
  • Increased farmer selling pressured basis lower this week, while river traffic to the Gulf began to normalize. The planned Columbia-Snake River system maintenance closure in March lent limited support to nearby soft white (SW) basis.
  • In its weekly Export Sales Report, USDA reported net sales of 387,900 metric tons (MT) for delivery in marketing year 2015/16 were 53% higher than the previous week. Sales were in line with trade expectations of 200,000 to 450,000 MT and 77% higher than the prior 4-week average. Total known outstanding sales and accumulated exports of all wheat classes for marketing year 2015/16, through Feb. 18, 2016, were 17.7 million metric tons (MMT), 17% lower than last year's year-to-date total of 21.3 MMT.
  • The Argentina Buenos Aires Grain Exchange estimates Argentine farmers produced 11.3 MMT of wheat in 2015/16, a 19% reduction from the 2014/15 production of 13.9 MMT.
  • At its annual Agricultural Outlook Forum Feb. 25 to 26, USDA predicted U.S. wheat production will decrease 3% year over year to 54.19 MMT in 2016/17 due to wheat planted area dropping an estimated 7% to 51.0 million acres.
  • UkrAgroConsult estimates 2016/17 Ukrainian wheat production will be 17.3 MMT, down 30% from 24.8 MMT in 2015/16.
  • The CME Group announced it would add quality data from CBOT wheat and oats deliveries beginning immediately in its daily "issues and stops" report on CBOT grain deliveries.
  • The Baltic Panamax Index closed higher for the tenth consecutive trading session on Friday at 323, up 3% week over week.
  • The Dollar Index rose to 98.07 up 1% from 96.65 last Friday.
  • Current HRS price indications are for Northern Spring. Dark Northern Spring is available, but premiums vary. Soft red winter (SRW) indications are for a minimum falling number of 250. Higher minimum specifications will carry a premium.

File Name
PR 160226.pdf
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