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May 28, 2010

(See attached file: PR 100528.pdf)(See attached file: PR 100528.xls)

Highlights:
  • Wheat futures traded lower this week with favorable growing conditions and a stonger dollar pressuring prices. CBOT nearbys lost 7 cents on Tuesday from a stronger dollar, but gained some of that back on Thursday due to short-covering. However, the dollar rallied again on Friday to push futures markets back down. CBOT nearbys lost an additional 10 cents on Friday and 14 cents on the week, finishing at $4.57/bu. KCBT nearbys lost 13 cents from last week, to $4.81/bu, and MGEX lost 8 cents, to $5.06/bu. Favorable growing conditions and a stronger dollar also pushed corn prices lower, with CBOT corn losing 10 cents on the week, to $3.59/bu. CBOT soy nearbys lost 3 cents, to $9.37/bu.
  • USDA’s latest Crop Progress Report indicated spring wheat conditions are the highest in the past 20 years, with 85 percent of the crop rated in either good or excellent condition. Spring wheat plantings are on pace with the five-year average at 91 percent complete. Winter wheat conditions remain favorable, with 66 percent of the crop rated in either good or excellent condition, compared to 45 percent a year ago.
  • Rains have slowed planting progress in Saskatchewan, Canada’s top wheat-producing province. Saskatchewan Agriculture indicates planting at 55 percent complete, compared to the five-year average of 81 percent. The Canadian Wheat Board reports planting for all of Western Canada at 64 percent complete, well behind the average pace of 80 percent.
  • Russian agricultural analyst SovEcon lowered their Russian wheat production estimate for 2010/11 due to winterkill losses and lower yields. The analyst currently projects the Russian crop to reach 55.5 MMT, down from 61.7 MMT in 2009/10.
  • SRW basis prices continued to climb higher this week, reaching 65 cents/bu. Higher barge rates and concerns over the size of this year’s crop have supported basis values, which have gained 25 cents/bu in the past three weeks.
  • The CBOT SRW/corn spread fell to under a dollar this week, standing at 98 cents on Friday.
  • The Dollar Ice Index was stronger this week after Fitch Ratings downgraded Spain’s credit rating, pushing the Euro lower against the dollar. The index stood at 86.71 on Friday, up from 85.37 a week ago.
  • The Baltic Panamax Index made its first weekly decline in over a month, falling from 4,576 last week to 4,247. Slowing iron ore demand as the Indian monsoon season begins is said to have pressured prices.

File Name
PR 100528.pdf
PR 100528.xls
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