March 15, 2019
- All wheat futures prices for the May contract period ended the week up, mainly on speculator buying, possibly based on pending tenders, between Thursday and Friday. The initial emergence of the 2019/20 U.S. wheat crop from dormancy into continued very cold conditions (see below) and a weaker U.S. dollar enhanced gains. May soft red winter (SRW) futures gained 23 cents from last week to end at $4.62/bu and May hard red winter (HRW) futures gained 12 cents to close at $4.43/bu. May hard red spring (HRS) futures increased by 5 cents to close at $5.55/bu. CBOT May corn futures gained 9 cents to end at $3.73/bu. CBOT May soybean futures gained 13 cents to land at $9.09/bu.
- Extreme winter weather continued across the central United States this week, delaying March wheat shipments from the Midwest and High Plains to Pacific Northwest (PNW) and Gulf ports. Domestic grain transport systems are so burdened by snow and floods that most wheat orders placed in March will not be delivered until April. As such, U.S. Wheat Associates (USW) has removed March 2019 price information from this week’s Price Report. Export basis for all classes in the PNW and the Gulf for nearby and deferred delivery months declined or held steady this week on slow export demand and the expectation that domestic wheat shipping logistics will clear by the end of April into May. The Great Lakes – St. Lawrence Seaway System closed on Dec. 31, 2018 and is scheduled to reopen this month. The Columbia-Snake River System is closed for annual, planned maintenance until March 24, 2019.
- This week, net export sales of 263,000 metric tons (MT) were reported for delivery in 2018/19, down 58 percent from last week’s 621,700 MT and 55 percent from the previous 4-week average of 582,175 MT. Year-to-date commercial sales of 22.8 million metric tons (MMT) make up 87 percent of the USDA’s updated 2018/19 export figure of 26.3 MMT.
- Year-to-date commercial sales of 22.8 million metric tons (MMT) make up 87 percent of the USDA’s updated 2018/19 export figure of 26.3 MMT.
- Click here to view the most recent USW Commercial Sales report.
- According to the March 14 Drought Monitor, below-average temperatures and above-average precipitation hit most of the country. Western Oklahoma and northern Texas received adequate rainfall that reduced areas classified as “abnormally dry” or under “moderate drought.” Heavy snows in the Midwest this week added to logistical delays. Dry conditions in the wheat growing regions of eastern Washington and northern Idaho have improved. Looking ahead, more precipitation from the Rockies and Central and High Plains to the upper Midwest is expected.
- Data from the European Commission confirmed that European Union non-durum exports for delivery in 2018/19 total 12.5 MMT as of March 10, 2019, down 11 percent from last year’s export volume of 14.0 MMT. In addition, France’s AgriMer estimated the EU wheat crop will be at 146 MMT in 2019/20 compared to last year when drought cut production to 127 MMT.
- According to the Ukrainian Agriculture Ministry, all grain exports as of March 13, 2019, total 34.3 MMT and are 19 percent ahead last year’s export pace. At 12.8 MMT, wheat makes up 37 percent of Ukraine’s 2018/19 grain exports so far.
Baltic and U.S. Dollar Indices
- The Dollar Index closed at 96.59, down from last week’s peak at 97.37.
- The Baltic Dry Index gained 20 points from last week to land at 677, its highest point since late January
Source: U.S. Wheat Associates