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August 9, 2013

(See attached file: PR 130809.pdf) (See attached file: PR 130809.xls)

  • All three futures contracts closed lower this week on fears that U.S. wheat is too expensive relative to competing origin wheat and to U.S. corn. Weak demand for U.S. wheat on the global market prompted the fears. Expectations of a strong upcoming spring wheat harvest added pressure to MGEX contracts. CBOT September wheat fell 27 cents to close at $6.34/bu. KCBT closed 10 cents lower at $6.97/bu and MGEX lost 8 cents to $7.34/bu. CBOT September corn dropped 14 cents to $4.74/bu and CBOT August soybeans added 10 cents to close at $13.41/bu.
  • On Monday, USDA reported the percentage of spring wheat rated good to excellent was unchanged from the previous week at 68 percent, compared to 63 percent the previous year. The percentage rated poor or very poor increased one point to 7 percent, down from 11 percent last year. USDA reported winter wheat harvest as 87 percent complete, up from 81 percent last week and the 5-year average of 86 percent.
  • Several high volume buyers have buoyed U.S. commercial sales in the early months of marketing year 2013/14. However, strong and increasing price competition has limited sales to other customers. Total known outstanding sales and accumulated exports of all classes of wheat for the 2013/14 marketing year, through August 1, 2013 were 13.6 MMT, 42 percent greater than last year's year-to-date total of 9.58 MMT. However, HRS, white wheat and durum sales are all below last year’s pace. USDA reported weekly sales of 726,200 MT on Thursday, above trade expectations of 500,000 to 700,000 MT.
  • The increasing price premium of wheat over corn prompted traders to unwind long wheat/short corn spreads this week, pushing CBOT wheat futures lower. CBOT September wheat closed $1.60/bu higher than CBOT September Corn on Friday, down from a $1.73/bu premium last week.
  • The Baltic Panamax Index fell for the third consecutive week, down 73 points to 948. Low demand for grain and coal shipments pushed freight prices lower and weighed on the index. Maritime Research's Grain Freight Index decreased from 489.5 to 488.0.
  • The US Dollar Index declined slightly from 81.98 last Friday to 81.16.

File Name
PR 130809.pdf
PR 130809.xls
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