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March 30, 2012

(See attached file: PR 120330.pdf) (See attached file: PR 120330.xls)

  • Two bullish USDA reports spurred a sharp gain in futures on Friday and helped wheat markets close higher overall for the week, despite an earlier three-day slide. Good crop weather, weakness in the corn market and unease ahead of the USDA reports pressured prices midweek in spite of a weaker dollar that supported prices Monday. MGEX had the sharpest gain on Friday thanks to a lower than expected spring wheat acreage projection. After a 49-cent gain on Friday, the MGEX May contract closed at $8.37/bu, a 20-cent increase week over week. CBOT closed 7 cents higher than last week at $6.61/bu and KCBT closed at $6.98/bu, a three-cent gain. CBOT wheat gained 48 cents on Friday and KCBT gained 43 cents. CBOT corn gained the daily limit of 40 cents on Friday to reclaim most of the early week loss, closing down three cents from last week at $6.44/bu. CBOT soybeans gained 37 cents on the week to close at $14.03/bu, assisted by a 47-cent gain on Friday.
  • USDA released its annual Prospective Plantings report Friday morning, consisting of planted acreage estimates based on data submitted by U.S. farmers. USDA estimates 2012/13 U.S. wheat plantings at 55.9 million acres, up from 54.4 million acres last year and below the pre-report trade estimates of 57.4 million acres. USDA expects winter wheat acres to increase 3 percent from last year to 41.7 million acres and durum acreage to increase 62 percent to 2.22 million acres. Both the winter wheat and durum acres closely met trade expectations but estimated spring wheat plantings fell below expectations. USDA estimates spring wheat plantings at 11.9 million acres, down from 12.4 million acres last year and below trade expectations of 13.3 million acres. The report significantly boosted futures prices on Friday.
  • Bullish estimates released in USDA’s quarterly grain stocks report supported futures markets on Friday. USDA estimates March wheat stocks at 32.7 MMT, down from 38.8 MMT last year at this time and below the pre-report trade expectations of 33.2 MMT. Estimated corn stocks of 153 MMT are 13.1 MMT lower than last year’s level and below trade estimates of 156 MMT.
  • U.S. commercial wheat sales fell far short of trade estimates this week with net sales of 226,100 MT, down 58 percent from the previous week and 47 percent from the prior 4-week average. The disappointing sales report contributed to a decline in futures prices on Thursday. Total sales for the 2011/12 marketing year, through March 15, 2012 were 25.4 MMT. USDA forecasts 2011/12 total U.S. wheat exports (including donations) to reach 27.2 MMT.
  • The Baltic Panamax index closed higher for the fifth week in a row at 1,051, up from 1,036 last week due to increased demand from the South American corn and soybean harvest. However, the increased demand has not been enough to counteract the oversupply of vessels and, therefore, physical freight rates remained unchanged from last week.
  • The ICE Dollar Index closed lower this week at 79.14, down from 79.58 last Friday.

File Name
PR 120330.pdf
PR 120330.xls
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