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September 23, 2016
  • Wheat futures rose this week supported by strong export sales and growing concerns about the milling quality wheat supply. Abundant global stocks continue to limit gains. CBOT December wheat added 1 cent to $4.05/bu, KCBT gained 4 cents to $4.21/bu and MGEX rose 11 cents to $5.04/bu. CBOT December corn finished the week flat at $3.36/bu and CBOT November soybeans lost 11 cents to $9.55/bu.
  • Hard red spring and durum wheat basis firmed across all ports this week due to growing quality concerns in the Canadian crop. Ordinary protein hard red winter basis also firmed this week due to increased export demand resulting from the Moroccan and Algerian tenders. Country elevators, export terminals and farmers are focused on soybean and corn harvest, supporting export basis as exporters will need to buy elevation and freight away from corn and soybeans in order to ship any wheat in the nearby.
  • The Columbia-Snake River System closure for planned maintenance will begin on Dec. 12, 2016, supporting soft white wheat basis levels from December through March. The system is expected to reopen at the end of March 2017.
  • USDA’s weekly Export Sales Report included net wheat sales of 561,000 metric tons (MT) for marketing year 2016/17. Sales were above trade expectations of 300,000 to 500,000 MT. Total known outstanding sales and accumulated exports of all classes of wheat for 2016/17, through Sept. 15, 2016, were 13.5 million metric tons (MMT), 22% higher than 11.0 MMT last year on this date. USDA expects 2016/17 U.S. wheat exports to reach 25.9 MMT.
  • As of Sept. 19, U.S. spring wheat harvest is 98% complete, compared to the 5-year average of 93%. USDA reported U.S. winter wheat planting is 17% complete on pace with the 5-year average.
  • As of Sept. 20, 35% of the Canadian durum samples collected by the Canadian Grain Commission (CGC) were #1 or #2 Canadian Western Amber Durum (CWAD), 35% was #3 CWAD and 30% #4 or #5 CWAD. CGC reported 16% of the Canadian Western Red Spring (CWRS) samples graded #1 CWRS, 45% #2 CWRS, 22% #3 CWRS and 17% Canadian Western Feed.
  • Russia’s Agricultural Ministry pegged 2016/17 Russian wheat production at 71.0 MMT, up nearly 10 MMT from 2015/16.
  • Coceral, an EU grain lobby, forecast EU 2016/17 soft (non-durum) wheat production at 133 MMT, in line with other industry forecasts.
  • According to Reuters, India reduced its import tariff on wheat from 25% to 10% after back-to-back years of lower wheat production due to drought constrained supplies.
  • Egypt bought 240,000 MT of Russian wheat this week after changing its ergot specification to a maximum 0.05%. Year to date Egyptian purchases (including shipments that were later rejected for not meeting the ergot specification) total 2.33 MMT, 28% behind the 5-year average purchase pace. On average, Egypt purchases 4.50 MMT of grain each year through public tenders.
  • The Baltic Index jumped to 937, 17% higher than last week’s close of 800 due to strength in the capsize market.
  • The Dollar Index slipped to 95.48, down 1% from 96.12 last Friday.
  • Current hard red spring (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 160923.pdf
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