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December 22, 2011


(See attached file: PR 111222.pdf) (See attached file: PR 111222.xls)

Highlights:
  • All three wheat futures markets gained this week, mostly due to speculators making purchases to cover short positions before the end of the year. Strength in the corn market and outside financial markets also lent support to wheat this week. The CBOT nearby contract lead the way gaining 38 cents to close 6.5 percent higher than last Friday at $6.22/bu. KCBT and MGEX each gained 33 cents to close at $6.72/bu and $8.43/bu, respectively. The CBOT corn contract closed 35 cents higher at $6.18/bu and CBOT soybeans finished the week at $11.71/bu, a 32 cent increase.
  • Heavy snowstorms hit the U.S. southern plains region on Monday and Tuesday, providing as much as 15 inches of snow to an area that suffered from a yearlong drought in 2011. U.S. HRW production dropped 23 percent in 2011/12 to 21.2 MMT due to the drought conditions, particularly in Texas and Southern Kansas.
  • The UK wheat harvest produced 15.3 MMT this year according to the British Farm Ministry. A 2 percent increase in planted area combined with a 1 percent increase in yield resulted in the 2.5 percent production increase for 2011/12.
  • Germany’s winter wheat planted area for the 2012 summer harvest is up 2.0 percent over last year to 3.2 million hectares, according to the national statistics agency. Based on a national acreage survey, the increased area is an early indication that next year’s crop could be larger than this year. The combination of a spring drought and summer rain lowered Germany’s 2011/12 production to 22.8 MMT from 23.6 MMT the previous year. Germany is the EU’s second largest grains producer after France.
  • India’s Farm Minister said Monday that the country is on pace to produce more wheat in 2011/12 than last year’s record of 85.9 MMT. USDA estimates India’s 2011/12 production will match last year’s 85.9 MMT and that domestic consumption will reach 84.7 MMT.
  • The Baltic Panamax Index closed lower this week as grain activity dropped down to more typical levels after several weeks of unseasonably high volume. The index closed at 1,676 on Thursday, down from 1,775 last Friday.
  • The ICE Dollar Index closed the week relatively unchanged at 80.31, down from 80.34 last Friday.

File Name
PR 111222.pdf
PR 111222.xls
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