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December 18, 2015
  • Wheat futures finished the week mixed due to technical trade, which dominated this week’s price movement. Little change to the underlying, bearish fundamentals occurred with the Northern Hemisphere crop in winter dormancy and the Southern Hemisphere crop nearly harvested. Argentina President Macri’s policy changes limited gains as the world waits to see their final impact. A strong U.S. dollar and ample global supply also capped gains. CBOT March wheat lost 4 cents to $4.87/bu. KCBT and MGEX March wheat both closed even with last week at $4.82/bu and $5.08/bu, respectively. CBOT March corn dropped a penny to $3.74/bu and CBOT January soybeans climbed 21 cents to $8.92/bu.
  • Basis softened across the country due to slow trade ahead of the holidays.
  • In its weekly Export Sales Report, USDA reported net sales of 320,200 metric tons (MT) for delivery in marketing year 2015/16, which is up 42% from the previous week, but 22% lower than the prior 4-week average. Sales were within trade expectations of 250,000 to 450,000 MT. Total known outstanding sales and accumulated exports of all wheat classes for marketing year 2015/16, through Dec. 10, 2015 were 15.0 million metric tons (MMT), 16% lower than last year's year-to-date total of 17.8 MMT.
  • Argentine President Mauricio Macri eliminated exports taxes on wheat and corn this week and allowed the Argentine peso exchange rate to move with the market, giving Argentine farmers full access to U.S. dollars for the first time in four years. Harvest of the 2015/16 wheat crop is 50% complete as of Dec. 17 according to Bolsa de Cereales.
  • On Dec. 9, Brazil’s Secretary of State for Agriculture and Supply estimated production in Paraná and Rio Grande do Sul at 4.9 MMT, 18 percent lower than 2014/15, due to poor growing conditions and excessive rains at harvest that also downgraded quality.
  • In its first estimate for 2016, Strategie Grains pegged 2016/17 EU wheat production at 143.6 MMT, down from the 158 MMT USDA estimates the EU produced in 2015/16.
  • Planted area for the 2016/17 wheat crop in India, which is in its second year of drought, is down 11 percent year over year, according to Reuters.
  • The Baltic Panamax Index closed at 471, a record low, and down 12% week over week.
  • The Dollar Index closed at 98.83, up from 97.54 last Friday. The U.S. dollar hit a two-week high on Wednesday after the U.S. Federal Reserve raised interest rates for the first time in nearly a decade.
  • There were significant changes in freight values for South American destinations this week due to the inclusion of new freight sources. These sources are believed to be more accurate and will be used in the future.
  • 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.
  • This is the last Price Report of 2015 due to the holidays. USW Price Report will resume on January 8.

File Name
PR 151218.pdf
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