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August 10, 2007
(See attached file: PR070810.pdf)(See attached file: PR070810.xls)

Highlights
  • U.S. futures continued to find direction from European markets as Paris futures hit record highs on persistent rain delaying the harvest and increasing quality concerns. U.S. SRW December delivery closed at $7.01 on Wednesday. Markets turned volatile late in the week despite another strong U.S. export report, closing lower in the final two sessions. Spillover effect from Wall Street has been cited. For the week, CBOT September futures finished up 17 cents/bu, the KCBT was up 15 cents/bu and the MGE rose 21 cents/bu. Corn futures finished up 7 cents.
  • The USDA World Agricultural Supply and Demand Estimates released today were seen as market neutral. The forecast for U.S. exports was revised up 680,000 MT, 4.5 MMT above last year.
  • The only positive production news in the WASDE for a global exporter came in the Black Sea region. Earlier in the week Russian Trade Minister said his government would soon announce intervention grain sales to stabilize domestic prices. When Russia pursued a similar policy in 2004, it established an export tariff of 25 euros/MT ($34).
  • The corn/SRW price spread at the CBOT widened to $3.34 this week, limiting wheat use in feed rations.
  • SRW is now at a 17 cent/bu ($6/MT) premium to SW on producer selling at harvest in the PNW.
  • Freight rates fell in both the Atlantic and Pacific. The Chinese government reportedly intends to slow steel exports in the second half of 2007, freeing up vessel capacity considerably. Rates in the Atlantic basin fell by $4/MT and the Pacific was down $2/MT.

USW Commercial Sales Report:
http://www.uswheat.org/commercialSales/doc/F018C43E8B350BA0852573320050FF88?OpenDocument#

USDA World Agricultural Supply and Demand Estimates:
http://www.usda.gov/oce/commodity/wasde/latest.pdf

File Name
PR070810.pdf
PR070810.xls
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