April 12, 2019
- Weekend blizzards across the Northern Plains (see below) could delay spring wheat planting in South Dakota and Minnesota, supporting hard red spring (HRS) futures prices over last week’s close. Hard red winter (HRW) futures traded up week over week on technical selling while soft red winter (SRW) futures fell on disappointing export demand. May HRS futures gained 10 cents over last week to close at $5.33/bu. May HRW futures gained 3 cents to end at $4.34/bu and May SRW futures lost 3 cents to close at $4.64/bu. CBOT May corn futures dropped one cent to end at $3.61/bu. CBOT May soybean futures lost 4 cents to close at $8.95/bu.
- Minimal export demand pressured soft white export prices and HRS and HRW export basis for nearby and deferred delivery months out of the Pacific Northwest (PNW). Rail transportation logistics improved week over week but are still delayed due to the severe weather conditions in late February and March, supporting HRS and HRW export basis for April delivery out of the Gulf.
- USDA’s April 8 Crop Progress report rated 60% of U.S. winter wheat in good or excellent condition, well above last year’s estimate of 30%. U.S. spring wheat planting is 2% complete, below the five-year average of 5%.
- USDA increased its U.S. wheat ending stocks forecast to 29.6 MMT on reduced export demand and reduced domestic seed use. U.S. export expectations fell from 26.3 MMT in March to 25.7 MMT in April. Global trade expectations are forecast to fall 2% from last year to 178 MMT. Expected global use for 2018/19 fell 3 MMT from the March estimate to 739 MMT on lower feed and residual use in the European Union and Iran.
- This week, net commercial U.S. wheat sales of 273,000 metric tons (MT) for delivery in 2018/19 were down 61% from last week’s 704,700 MT and down 37% from the previous -week average of 519,000 MT. Year-to-date commercial sales of 24.6 million metric tons (MMT) make up 96% of USDA’s expected 2018/19 export volume of 25.7 MMT (see below).
- In addition to net and total commercial sales for 2018/19 delivery, USDA also reported net sales of 201,400 MT for delivery in 2019/20.
- Click here to view the most recent USW Commercial Sales report.
- According to the April 11 Drought Monitor, drought and abnormally dry conditions persist in a few regions. A series of rainstorms brought improvement to conditions in Oregon but did little to improve the rain deficits in Washington state and parts of Wyoming where snowpack was below average this winter. Cooler than normal temperatures and heavy rainfall impacted the Midwest this week while warmer than normal temperatures spread across much of the High Plains. Despite the mild conditions early in the week, another set of powerful storms are expected to drop as much as 10 to 20 inches of snow from western Nebraska to western Minnesota. Heavy rains are forecast in areas of the Midwest already struggling from record floods.
- Ukraine’s Agriculture Ministry reported spring grain sowing at 141,000 hectares as of April 10, 85% of the final forecast for 2019.
- SovEcon, Russia’s agriculture consultancy, reported favorable planting conditions for the 2019/20 crop year. As of April 5, farmers are 3% finished with spring grain planting at 968,000 hectares, up 147% from this time last year.
- Stratégie Grains cut its production forecast for French soft white wheat from 146 MMT to 144 MMT on dry weather concerns. The forecast would still exceed last year’s harvest by 14%.
Baltic and U.S. Dollar Indices
- The Baltic Dry Index gained 17 points over last week to close at 728.
- The Dollar Index fell slightly from last week’s 97.4 to 96.9.
Source: U.S. Wheat Associates