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January 19, 2017
  • Wheat futures slipped a bit this week due to pressure from weekend storms that brought beneficial moisture to most of the U.S. winter wheat growing area. Large global stocks continue to weigh on the market. CBOT March wheat fell 2 cents to $4.23/bu, KCBT dropped 7 cents to $4.42/bu and MGEX lost 6 cents to $5.76/bu. CBOT March corn added 8 cents to $3.66/bu and CBOT March soybeans climbed 24 cents to $10.70/bu.
  • Export basis is sharply inverted from nearby to deferred contracts due to continued logistics challenges. Traders report the worst fog in recent memory continues to delay barge arrivals and vessel loading in New Orleans. The Pacific Northwest continues to work through rail and vessel loading delays resulting from unusually heavy of snow that fell on the region last week. Due to delays in loading at the ports and the restricted movement of grain from the country to the export terminals, export capacity in February and March is limited further supporting export basis in those months. Soft white wheat export basis received additional support from the Columbia-Snake river system closure for planned maintenance that will run through March. The Great Lakes-St. Lawrence Seaway System closed for the season on Dec. 20 and will reopen at the end of March.
  • The Jan. 19 U.S. Drought Monitor reported that much-needed precipitation, most of it in the form of freezing rain, fell across Kansas, southwestern Missouri and parts of Oklahoma and Texas. However, eastern Oklahoma and eastern Texas are still 4 to 8 inches (10 to 20 cm) below normal for the past 90-days. The 5-day forecast shows little relief for Oklahoma and Texas.
  • On Jan. 19, Bolsa de Cereales, the Argentine Grain Exchange, reported wheat harvest was complete. The final average yield is 3.39 metric tons per hectare (MT/ha) (50.4 bu/acre) compared to the 2015/16 of 3.09 MT/ha (46.0 bu/acre). Bolsa de Cereales believes Argentine farmers produced 15.0 MMT of wheat, up 39% from 2015/16. Harvested area is up 33% year over year at 10.9 million acres (4.42 million hectares).
  • The International Grains Council (IGC) increased its forecast for 2016/17 global wheat production to 752 MMT, up 3 MMT from its prior forecast based upon improved estimates from Argentina and Australia. IGC pegged 2017/18 global wheat production at 735 MMT, down 2% year over year, if realized.
  • The Baltic Index climbed to 952, up 7% from 892 last week.
  • The Dollar Index rose slightly week over week to 101.32.
  • Current hard red spring (HRS) price indications are for Northern Spring. Dark Northern Spring is available, but premiums vary. SRW indications are for a minimum falling number of 250. Higher minimum specifications will carry a premium.

File Name
PR 170119.pdf
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