August 2, 2019
- All wheat futures prices fell week-over-week due to spillover pressure from soybeans after President Trump announced that an additional 10% tariff would be placed on $300 billion worth of Chinese imports on September 1. Soft red winter (SRW) September futures lost 5 cents to close at $4.91/bu and hard red winter (HRW) futures lost 10 cents to end at $4.22/bu. Hard red spring (HRS) September futures fell 2 cents to close at $5.22/bu. CBOT September corn futures fell 15 cents to end at $3.99/bu. SBOT August soybean futures fell 33 cents to close at $8.50/bu.
- Cheaper rail rates and winter wheat harvest progress in the Southern Plains pressured Gulf HRW export basis for August and September deliveries. Limited export demand offset minimal farmer selling out of the Pacific Northwest (PNW), holding HRS and HRW export basis steady week-over-week while increased farmer selling pressured PNW soft white wheat (SW) export prices for nearby and deferred deliveries.
- On July 29, USDA reported winter wheat harvest at 75% complete compared to 84% last year and the 5-year average of 86%. Montana winter wheat harvest is only 1% complete compared to 17% last year and the 5-year average of 35%. U.S. spring wheat is 97% headed compared to 99% in 2018 and the 5-year average of 98%. USDA reported 78% of U.S. spring wheat in good to excellent condition, ahead of last week’s 76%.
- Net U.S. wheat sales as of July 25 of 383,000 metric tons (MT) for delivery in 2019/20 were 42% lower than last week’s 660,000 but within trade expectations of 300,000 to 600,000 MT. Year-to-date commercial sales of 8.90 million metric tons (MMT) are 24% ahead of last year’s pace. USDA forecasts 2019/20 U.S. wheat exports will total 25.9 MMT, 6% higher than 2018/19, if realized.
- Click here to view the most recent USW Commercial Sales report.
- For the week ending on August 1, Drought Monitor reported cool, dry weather across the High Plains and widespread rainfall from northeastern Colorado through southeastern South Dakota. Cool, dry conditions are expected across the Southern Plains next week.
- According to the Ukrainian Ministry of Agriculture, the 2019/20 Ukrainian early grains harvest is now 86% complete at 8.7 million hectares harvested (21.5 million acres). So far, Ukrainian farmers have harvested 24.1 MMT of winter wheat.
- DBV, the association of German farmers, reduced its 2019/20 German winter wheat harvest forecast by 2.0 MMT following the country’s summer heatwave. German farmers are expected to harvest about 22.0 MMT of winter wheat in 2019, 12% higher than 2018/2019 levels, if realized.
- As of July 29, according to Russia’s Agriculture Ministry, Russian farmers have harvested 41.2 MMT of wheat in 2019 compared to 29.5 MMT in 2018 on dry, favorable harvest conditions. Russian harvested area now totals 11.2 million hectares (27.7 million acres) compared to last year’s 7.8 million hectares (19.3 million acres).
- On July 30, Agritel, a European agriculture consultancy, forecast French soft wheat (non-durum) production at 39.2 MMT on strong yield potential despite the country’s recent heatwave. If realized, the 2019/20 harvest would be 15% higher than 2018/19 and the second largest on record.
Baltic and U.S. Dollar Indices
- The Baltic Dry Index fell 6% week-over-week to end at 1,812.
- The U.S. Dollar Index climbed from last week’s 98.01 to close at 98.40.
Source: U.S. Wheat Associates