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November 19, 2010

(See attached file: PR 101119.pdf)(See attached file: PR 101119.xls)

Highlights:
  • Futures prices were down again this week as continued discussion about a tighter Chinese monetary policy weighed on the markets. CBOT nearbys lost 46 cents on Tuesday, falling to over a three-month low, but received support later in the week from a weakening dollar and strong export sales. Overall, the CBOT December contract was down 24 cents, closing at $6.44/bu. KCBT and MGEX nearbys were also down, closing at $7.09/bu and 7.25/bu, respectively. Soybean prices were hit especially hard by China’s plan to tame food inflation and lost 66 cents on Tuesday. The CBOT January soybean contract closed at $12.01/bu, down 67 cents from a week ago. Corn prices lost 13 cents, closing at $5.20/bu.
  • Ukraine announced it will extend its grain export quotas through the first half of 2011. The Ukrainian Agriculture Minister stated that total grain exports will be limited to 5 MMT between January and July of 2011. The Ukrainian government estimated that this year’s wheat harvest reached 17.2 MMT, down from 20.9 MMT a year ago.
  • The Buenos Aires Grain Exchange increased their 2010/11 Argentine production estimate on Thursday. The Exchange raised their projection from 12.1 MMT to 12.7 MMT due to improved crop conditions. USDA currently projects 13.5 MMT for this year’s Argentine wheat crop.
  • The United Nation’s Food and Agriculture Organization (FAO) released their latest 2010/11 global wheat production estimate this week, projecting a crop of 648 MMT. This is down from their September forecast of 650 MMT. FAO projected 2010/11 U.S. wheat exports at 33.5 MMT, 1.5 MMT greater than USDA’s current estimate.
  • Strong export demand supported prices this week. USDA reported commercial export sales of 943,400 MT, which reached a 10-week high and exceeded trade estimates of 400,000 to 600,000 MT. Increases were reported for unknown destinations (150,000 HRW, 52,500 HRS, -11,614 SRW), Mexico (76,587 HRW, 61,000 HRS, 10,001 SRW, 2,452 white), Egypt (55,000 SRW, 60,000 white), Iraq (100,000 HRW), Nigeria (39,047 HRW, 15,000 HRS, 21,804 SRW, 10,000 white), and Japan (41,012 HRW, -472 HRS, 27,872 white).
  • Soft red winter FOB premiums were up again this week due to lack of grain movement. Gulf SRW basis was up 10 cents, to $1.20 per bushel.
  • The ICE Dollar Index was up again this week, closing at 78.51 on Friday, up from 78.11 a week ago. The index has gained three percent since hitting a ten-month low on November 4.
  • The Baltic Panamax Index was down sharply this week, losing 14 percent and closing at 2,038. The Baltic Dry Index fell to a three-month low on Friday, losing 158 points from last week and closing at 2,155.

File Name
PR 101119.pdf
PR 101119.xls
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