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June 24, 2016
  • Seasonal harvest pressure, a stronger U.S. dollar and uncertainty from the macroeconomic markets pressured wheat futures lower this week. CBOT July wheat fell 26 cents to $4.55/bu, KCBT dropped 38 cents to $4.23/bu and MGEX declined 22 cents to $5.18/bu. CBOT July corn lost 53 cents to $3.84/bu and CBOT July soybeans plummeted 56 cents to $11.03/bu this week.
  • Basis firmed this week supported by competition for elevation capacity from soybeans and corn and steady export demand. Protein premiums for HRW continued to widen this week on the expectation of a high-yielding, lower protein HRW crop. Basis levels for the Pacific Northwest are firmer for the last quarter of 2016 due to planned maintenance closures on the Columbia River system. Fourth quarter basis for the Gulf and Lakes also firmed due to increased competition for elevation and shuttle train capacity from corn and soybeans.
  • In its weekly Export Sales Report, USDA reported net sales of 462,800 metric tons (MT) for the 2016/17 marketing year. Sales were within trade expectations of 400,000 to 600,000 MT. Total known outstanding sales and accumulated exports of all classes of wheat for the 2016/17 marketing year, through June 16, 2016 were 6.99 million metric tons (MMT), 28 percent higher than last year's year-to-date total of 5.48 MMT. USDA expects 2016/17 U.S. wheat exports to reach 24.5 MMT.
  • As of June 20, U.S. winter wheat harvest is 25% complete, behind the 5-year average pace of 28% complete on the same date. USDA rated 61% of the U.S. winter wheat crop as good to excellent, unchanged from the prior week and up from 41% last year. USDA rated 76% of the spring wheat crop in good to excellent condition, down from 79% last week, but up from 71% at the same time last year. USDA reported 28% of spring wheat had headed, compared to just 14% on the same date in 2015.
  • FranceAgriMer rated 71% of French soft wheat in good or excellent condition, down from 75% the prior week.
  • According to Reuters, excessive rains in China have impacted wheat quality and yields in the world’s largest wheat producer and consumer.
  • CME Group announced the launch of physically delivered European Union (EU) Wheat futures and options on futures contracts to begin trading on Sept. 12, 2016, pending all relevant regulatory review periods.
  • Russian grain harvest began this week, a few days ahead of normal according to the Russian Agricultural Ministry.
  • The Baltic Index fell to 596, slightly lower than last week’s close of 598.
  • The Dollar Index rose to 95.44, up 1% from 94.10 last Friday.
  • 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.

File Name
PR 160624.pdf
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