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U.S. Wheat Associates Weekly Price Report

U.S. Wheat Associates Weekly Price Report

Friday, May 18, 2018

Read the full report as a PDF

  • Dry weather in Australia and worsening drought conditions in the U.S. Southern Plains pushed wheat futures higher this week. A stronger U.S. dollar, which makes U.S. wheat more expensive relative to competing origins, limited gains. CBOT July wheat added 19 cents to $5.18/bu, KCBT climbed 21 cents to $5.39/bu and MGEX grew 24 cents to $6.29/bu. CBOT July corn increased 6 cents to $4.02/bu, and CBOT July soybeans fell 5 cents to $9.98/bu.
  • Farmer selling remains slow, lending support to export basis. The hot, dry conditions negatively affecting yield potential helped exporters load vessels more quickly than expected in the Gulf, freeing up export elevation capacity and softening Gulf nearby export basis. Soft white (SW) wheat protein premiums firmed this week as farmers evaluate how last week’s hot, dry weather affected the crop.
  • USDA’s weekly Export Sales Report included net wheat sales of 63,100 metric tons (MT) for marketing year 2017/18. Sales were within trade expectations of 0 to 200,000 MT. Total known outstanding sales and accumulated exports of all classes of wheat for 2017/18, through May 10, 2018, were 23.6 million metric tons (MMT), 16% behind last year’s year-to-date total. USDA expects 2017/18 U.S. wheat exports to reach 24.8 MMT.
  • On May 14, USDA rated 36% of the winter wheat crop in good to excellent condition, up from 34% last week, and 36% of the winter wheat is in poor or very poor condition. Though winter wheat conditions improved, 51% of Kansas, 65% of Oklahoma and 59% of Texas winter wheat is in poor or very poor condition. USDA reported 45% of winter wheat has headed, behind the 5-year average pace of 53%. U.S. spring wheat planting is 58% complete, behind the 5-year average pace of 67% on the same date; 14% of spring wheat has emerged, compared to the 5-year average of 36%.

U.S. Drought Monitor

  • The May 17 U.S. Drought Monitor reported drought expanded across the U.S. Northern Plains and intensified in Kansas, Oklahoma and Texas, putting significant HRW-producing area under exceptional drought. Damaging hail was also reported across Kansas, though the extent of the damage is still being evaluated. In the U.S. Northern Plains, 90% of North Dakota and 42% of South Dakota are abnormally dry or experiencing moderate to severe drought. The current forecast expects above average temperatures across the United States and rain across the U.S. Northern Plains that will benefit emerging wheat.

  • FranceAgriMer rated 78% of French common wheat in good to excellent condition, unchanged from the week prior.
  • According to the Ukraine Agriculture Ministry, spring wheat planting is 93% complete, still significantly behind last year’s pace.
  • According to the Saskatchewan weekly crop report, dry conditions last week helped Canadian farmers catch up on planting. As of May 14, 33% of spring wheat and 39% of durum was planted, up significantly from last week when individual crop planting estimates were not yet available. In Alberta, 9% of spring wheat planting is complete, unchanged from the week prior. The Alberta government noted standing water in fields and expects that many of those fields will not be seeded.
  • Australian farmers are planting wheat under very dry conditions. The Australian Bureau of Meteorology reported a majority of the Australian wheat-producing areas have received less than 60% of average rainfall since the beginning of February.

Baltic and U.S. Dollar Indices

  • The Baltic Index decreased to 1305, down from 1472 last Friday.
  • The Dollar Index rose to 93.58, up from 92.54 last week.

Source: U.S. Wheat Associates