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November 2, 2007
(See attached file: PR071102.pdf) (See attached file: PR071102.xls)

  • Despite a strong opening, US wheat futures ended the week lower. Nearby contracts rallied early in the week as continued weakness in the US dollar and soaring crude oil prices provided support. The remainder of the week saw futures move lower as the market began to sour on near-term export prospects. The CBOT nearby wheat contract ended 22 cents/bu lower from last week's level, while the KCBT and MGE were off 21.25 and 13.5 cents/bu, respectively.
  • The Australian Bureau of Agricultural and Resource Economics (ABARE) lowered its estimate for Australia's 2007/08 wheat crop to 12.1 MMT, down from a September estimate of 15.5 MMT. The downward revision brought the official government estimate closer to market expectations.
  • USDA reported net export sales of old crop wheat at 180.2 TMT, which was well below market expectations of 650.0-750.0 TMT, and was the lowest level for the 2007/08 marketing year. The largest increases in net export sales were to Nigeria (84.8 TMT), South Korea (48.0 TMT), and the United Kingdom (37.3 TMT). USDA reported zero sales for new crop 2008/09 wheat.
  • USDA reported in its weekly crop progress report that 88 percent of the US winter wheat crop has been planted, up from 82 percent the previous week, but slightly behind the 5-year average. Early conditions were reported 55 pecent good to excellent, while only 12 percent was reported as poor to very poor.
  • The SRW/Corn spread at the CBOT continues to narrow with December SRW not at a $4.02/bushel premium to corn compared with $4.28/bushel last week.
  • Freight markets softened slightly this week with the Gulf to Japan rate falling $2/MT to $120/MT and the PNW to Japan falling $2/MT to $97/MT.

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