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June 3, 2016
  • US wheat futures rose over the past week on a round of short covering and bargain buying supported by weakness in the US dollar and reports of excessive moisture in the Southern Plains and Western Europe. Soybeans and corn both rose on reports of smaller than expected crops in South America. Chicago wheat futures closed 16 cents higher, hitting a one month high. Kansas City wheat futures closed 14 cents higher. Minneaplolis wheat futures closed 12 cents higher. Corn futures closed 5 cents higher. Soybean futures closed 46 cents higher.
  • Basis levels were mostly steady this week as traders waited to see what affect the weather would have on Southern Plains wheat quality. Traders are especially concerned of the possibility of lower protein levels.
  • In its weekly export sales report, USDA reported a net sales gain of 107,377 metric tonnes (MT) for delivery in marketing year 2015/16, which were up from the previous week. Sales were within trade expecatations. Trades switching sales from 2015/16 to 2016/17 were limited. New marketing year sales for 2016/17 reached 385,019 MT. Total known outsanding stales and accumulated exports of all wheat classes for marketing year 2015/16, through May 26, 2016, were 20.7 millionmetric tonnes (MMT), down 11 percent compared to this same time last year. Total new marketing year sales for 2016/17 reached 4.2 MMT, up 12 percent compared to this same time last year.
  • Heavy rainfall kept farmers out of their fields in Texas and Oklahoma, delaying the HRW wheat harvest from getting into full swing. The precipitation is raising concerns of possible crop damage. However, farmers are expected to be able to continue work this weekend.
  • Torrential rainfall in Western Europe has caused widespread flooding northern and central France, home to the major wheat growing belt of that country. The large amount of water has raised concerns of possible crop damage.
  • A Reuters poll of traders and analysts projected that Black Sea wheat production in 201617 would fall 5 percent and that exports would fall 10 percent compared to 2015/16. An increase in production and export for Russia is expected to be more than offset by steep decreaess for Ukraine and a slight decrease for Kazakhstan.
  • Analysts reported that Australia is expected to produce between 24.0 and 26.0 MMT of wheat in 2016/17, which would make it one of the best crops in the past five years. Rainfall has been reported in Eastern Australia and growing conditions are excellent in the west.
  • The Baltic Dry Index rose to 606, up less than 1 percent from 601 last week.
  • The US Dollar Index fell to 93.87, down from 95.75 reported 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 060316.pdf
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