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March 4, 2016
  • After dropping to contract lows at the beginning of the week, wheat futures markets rebounded due to short-covering and support from dryness in the U.S. Southern Plains. A softer U.S. dollar also provided support, but the abundant world wheat supply continues to limit gains. Commodity funds also hold record net short positions for CBOT and KCBT wheat. Week over week CBOT March wheat climbed 2% and KCBT and MGEX March wheat each rose 3%. CBOT March wheat increased 11 cents to $4.55/bu, KCBT added 15 cents to finish at $4.58/bu and MGEX grew 13 cents to $5.03/bu on the week. CBOT March corn was flat week over week at $3.54/bu and CBOT March soybeans improved 15 cents from last Friday to $8.78/bu.
  • Steady farmer selling continued to pressure basis across the United States as farmers begin readying for spring planting. The Columbia-Snake River system is closed for routine maintenance from March 5 to 19, providing limited support for soft white (SW) basis.
  • In its weekly Export Sales Report, USDA reported net sales of 344,300 metric tons (MT) for delivery in marketing year 2015/16, which were 11% lower than the previous week. Sales were in line with trade expectations of 200,000 to 450,000 MT and 42% higher than prior 4-week average. Total known outstanding sales and accumulated exports of all wheat classes for marketing year 2015/16, through Feb. 25, 2016, were 18.0 million metric tons (MMT), 17% lower than last year's year-to-date total of 21.8 MMT.
  • In its monthly crop progress update by state, USDA reported winter wheat condition ratings improved for Kansas, Nebraska and South Dakota in February. Warm, spring-like weather caused much of the winter wheat in the region to break dormancy earlier than normal, leaving it vulnerable to a late freeze. Winter wheat ratings declined in Oklahoma, Illinois and Montana. The government will resume weekly U.S. crop progress reports in April.
  • Ukrainian 2016/17 wheat production is forecast to drop 20% year over year to 20 MMT due to a decrease in planted area that resulted from dry conditions during the autumn planting season, according to Reuters.
  • Agricultural consultancy SovEcon reported spring planting began two weeks early in Russia this week due to favorable weather. Winter grain condition ratings also improved with approximately 8% of grains in poor condition compared to 11% in November.
  • The CME Group announced it would add quality data from CBOT wheat and oats deliveries beginning immediately in its daily "issues and stops" report on CBOT grain deliveries.
  • The Baltic Panamax Index continued its rebound and closed 6% higher on the week at 342.
  • The Dollar Index fell to 97.31 down 1% from 98.07 last Friday.
  • Current 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 160304.pdf
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