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August 28, 2009

(See attached file: PR 090828.pdf)(See attached file: PR 090828.xls)
Highlights:
  • Futures were mixed this week as CBOT and KCBT traded higher while MGEX fell 10 cents. Spillover from strong gains in soy pushed prices up on Monday. Prices came back down on Friday as traders positioned themselves for September deliveries. MGEX took a harder hit due to freshly harvested spring wheat entering the market. Overall, CBOT September contracts finished the week up 5 cents, closing at $4.67/bu, while KCBT was up 6 cents at $5.00/bu. MGEX September futures were down 11 cents, closing at $5.21/bu. Soy rallied this week due to tight supplies and strong demand from China. Soy September contracts were up $1.15, closing at $11.35/bu. Corn dropped 1 cent to close at $3.21/bu.
  • Export sales reached a marketing-year high last week. Reported sales were 652,700 metric tons, which is up 82% from the previous week. Increases were reported for Nigeria (144,650 HRW, 8,000 HRS, 47,887 SRW, 10,000 white, 12,000 durum), Japan (26,000 HRW, 30,350 HRS, 33,100 white), Egypt (60,000 SRW), South Korea (10,320 HRW, 16,353 HRS, 610 SRW, 27,220 white), Mexico (10,006 HRW, 22 HRS, 25,033 SRW), and Taiwan (16,278 HRW, 15,412 HRS, 5 SRW).
  • The International Grains Council (IGC) released their latest wheat production estimates on Thursday. The IGC raised their forecast from last month by 8 million metric tons (MMT), projecting 2009/10 wheat production at 662 MMT. The increase is primarily due to yields in the EU, US, Ukraine, and China that exceeded expectations.
  • Showers continue to delay the spring wheat harvest, which is 22% complete. This is well behind both last year’s pace and the 5-year average. This time last year, the harvest was 58% complete and the 5-year average is 66%. USDA reported 72% of the crop in either good or excellent condition, which is up from 55% last year.
  • USDA released its 2009 Farm Income and Costs report, which forecasted a 38% decline in farm income this year. The report noted that the state of the global economy has reduced demand for many U.S. commodities and pushed prices well below last year’s averages. The report also noted U.S. wheat exports are down amidst large global supplies, which has contributed to lower wheat prices.
  • The Baltic Panamax Index continued to fall this week, closing at 2,157. This is a 4% decrease from last week. Destination routes were also down, with the Gulf/Japan route at $52/mt and PNW/Japan at $25/mt.

File Name
PR 090828.pdf
PR 090828.xls
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