April 5, 2019
- Improved planting conditions in the Northern Plains and news of increased Canadian spring wheat planted area (see below) pressured hard red spring futures prices this week, while short-covering in the middle of the week supported soft red winter (SRW) and hard red winter (HRW) futures prices. May SRW futures gained 10 cents over last week to close at $4.68/bu and May HRW futures gained 1 cent to end at $4.31/bu. May HRS futures fell 32 cents below last week to $5.22/bu, its lowest closing value since July 2018. CBOT May corn futures gained 6 cents to end at $3.62/bu. CBOT May soybean futures gained 15 cents to close at $8.99/bu.
- Improved rail logistics helped lower HRS and HRW export basis for nearby and deferred delivery months out of the Gulf and HRS export basis for the same delivery months out of the Pacific Northwest (PNW). Soft white export prices in the PNW came up from last week on limited elevator capacity and HRW export basis for April and May remained high on limited farmer selling.
- USDA’s April 1 Crop Progress report pegged 56% of U.S. winter wheat in good or excellent condition, much higher than last year’s early April estimate of 32%.
- This week, net commercial U.S. wheat sales of 704,700 metric tons (MT) for delivery in 2018/19 were up 48% from last week’s 475,700 MT and 70% from the estimated previous 4-week average of 457,000 MT.
- Year-to-date commercial sales of 24.3 million metric tons (MMT) make up 93% of the USDA’s expected 2018/19 export volume of 26.3 MMT.
- In addition to net and total commercial sales for 2018/19 delivery, USDA also reported net sales of 313,000 MT for delivery in 2019/20.
- Click here to view the most recent USW Commercial Sales report.
- Significant flooding remains a concern in the Midwest as heavy precipitation fell this week between northern Missouri and eastern Ohio. The April 4 Drought Monitor reported a majority of the High Plains free of drought or abnormal dryness. Looking ahead, much needed precipitation is expected in the wheat-growing regions of western Washington and western Oregon. Above-normal temperatures are expected across most of the continental United States next week.
- Ukraine’s Agriculture Ministry reported spring wheat planting at 118,000 hectares (2.91 million acres) as of April 4, 71% of the final forecast for 2019.
- Agriculture and Agri-Food Canada estimates its farmers will decrease durum planted area by 20% from 2018/19 to 2.0 million hectares (4.94 million acres). Non-durum planted area is expected to increase 9% year-over-year to 8.2 million hectares (20.2 million acres).
- According to the USDA, wheat production in Turkey for 2019/20 is forecast at 19 MMT, 3.5% higher than the 5-year average on adequate precipitation following the country’s drought in the 2018.
Baltic and U.S. Dollar Indices
- The Baltic Index gained 10 points from last week to close at 699.
- The Dollar Index closed at 97.4, up slightly from last week’s 97.25.
Source: U.S. Wheat Associates