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May 29, 2009

(See attached file: PR090529.pdf)(See attached file: PR090529.xlsx)

  • Futures traded higher this week, seeing increases towards the end of the week. Fund buying, along with concerns over delayed spring wheat planting and diseased winter wheat, were the main factors pushing prices up. July CBOT wheat futures finished 25 cents/bu higher, closing at $6.37/bushel. July KCBT futures was up 37 cents/bu and MGE ended 30 cents/bu higher. Soybeans closed the week up 17 cents/bu at $11.84/bu and corn closed up 6 cents/bu at $4.36/bushel.
  • USDA reported 45 percent of the winter wheat crop in either good or excellent condition, down from 48 percent the previous week. Spring wheat plantings increased to 79 percent complete, up from 50 percent from the week prior. However, wet conditions throughout the spring have kept spring wheat plantings well below the five-year average of 95 percent.
  • The dollar rebounded mid-week only to fall again to a new 2009 low. The dollar ICE index finished down 1 percent from last week and fell 6 percent over the month of May. Relaxed concerns that the US would lose its triple-A US sovereign rating pushed the dollar up during the week. However, increased consumer confidence and better-than-expected US unemployment claims brought the dollar back down as investors moved to riskier assets.
  • New crop sales reported were 228,200 MT, down 58 percent from last week’s sales of 543,300 MT. Sales were primarily for Nigeria (85,000 HRW), Yemen (50,000 white), Colombia (28,000 SRW), South Korea (4,100 HRW, 5,000 HRS, 11,600 white) and Italy (20,000 durum).
  • Freight indices reached an 8-month high this week. The Baltic Panamax index closed at 2,900, up 26 percent from last week’s close of 2,293. The Atlantic/Gulf to Asia component of the BPI closed 22 percent up from the previous week at 32,475, while the Pacific/Asia component was up 27 percent closing at 20,636. Demand for goods in China continues to drive the freight indices higher.

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