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February 20, 2009

(See attached file: PR 090220.pdf) (See attached file: PR 090220.xlsx)

Highlights:
  • Wheat futures were down this week amid spillover pressure from a strong dollar and continued uncertainty in the condition of the global economy. For the week, nearby CBOT futures were off 16 cents/bu, KCBT was 18 cents lower while the MGE closed down 11 cents/bu at $6.24/bu. Corn futures were 13 cents/bu lower at $3.50/bu while soybeans closed down 93 cents/bu at $8.63/bu.
  • Export sales of 433,500 MT were up 5 percent from the previous week, 48 percent from the prior 4-week average and at the high end of trade estimates of 250,000 to 450,000 MT. Sales to North Asia were strong with 90,000 MT to Japan and 69,000 MT to South Korea. SW sales of 121,300 MT were notable, pushing year-to-date sales to 3.3 MMT or 91 percent of the USDA total forecast. Commitments for all wheat classes to date of 23.094 MMT are 87 percent of total projected exports, down from the 5-year average of 91 percent of exports committed by this date.
  • CFTC reported that large speculators increased their net short position in CBOT wheat futures and options by another 3,581 contracts this week, up 6 percent from last week and 32 percent since the beginning of the year. Total CBOT wheat open interest was reported 3 percent higher this week and up 19 percent since January. Despite the year-to-date increase in open interest, current levels are still 30 percent below this time last year.
  • Wheat in the High Plains and Southern Low Plains of Texas continue to struggle due to lack of moisture. NASS reported that 64 percent of the Texas wheat crop is in poor to very poor condition, down 4 percent from last week but still on par with conditions this time last year.
  • Export prices were lower on the week due to weakness in the futures market. The nearby SW/SRW FOB spread widened to $26/MT, up slightly on the week but up more than 80 percent since the beginning of the year.
  • The dollar traded up and down this week but ended slightly higher as investors continue to flee risky assets. The ICE dollar index ended at 87.63, up 2 percent on the week and up 7 percent since the start of the year.

File Name
PR 090220.pdf
PR 090220.xlsx
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