US Wheat Associates

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• After a volatile week, technical selling following yesterday’s rally pressured all wheat futures prices week-over-week. A significantly weaker U.S. dollar (see below) cushioned losses. CBOT soft red winter (SRW) futures fell 5 cents to end at $5.15/bu. KCBT hard red spring (HRS) futures lost 9 cents to close at $4.61/bu. MGE hard red spring (HRS) futures fell 6 cents to end at $5.19/bu. CBOT corn futures added 5 cents to close at $3.31/bu. CBOT soybean futures gained 27 cents to end at $8.68/bu.

• Persistent dryness across the Southern Plains (see below) pressured total U.S. winter wheat crop ratings this week. Total crop ratings in Kansas increased week-over-week to 42% good to excellent. Colorado crop ratings fell slightly from last week to 31% good to excellent. In Oklahoma, winter wheat rated as good to excellent fell from last week’s 60% to 56% this week. As of June 1, 51% of the country’s winter wheat is in good to excellent condition, down from last week’s 54%.

• Recent harvest progress in the Southern Plains (see below) pressured Gulf HRW export basis for June and July deliveries. A slight delay to the 2020 SRW harvest due to wet field conditions in the Midsouth supported SRW export basis for nearby delivery. Gulf and Pacific Northwest (PNW) HRS export basis are unchanged week-over-week.

• The new crop U.S. wheat harvest is underway in parts of Texas, southern Oklahoma Arkansas and North Carolina. According to USDA, as of June 1, 3% of the country’s total winter wheat area is harvested. Click here to read more about the 2020 U.S. wheat harvest.

• Dry weather across the Northern Plains helped boost U.S. spring wheat planting week-over-week. Farmers have now planted 91% of intended spring wheat area, up from last week’s 81% but behind the 5-year average of 96%. According to USDA, 80% of the country’s spring wheat is in good to excellent condition, up from last year’s 74%.

Commercial Sales

• This week’s commercial sales of 179,000 metric tons (MT) for delivery in 2019/20, through May 28, were down 15% from last week’s 210,000 MT but within trade expectations of 50,000 MT to 250,000 MT. Year-to-date commercial sales for delivery in 2019/20 total 26.9 million metric tons (MMT), 4% ahead of last year’s pace. USDA’s latest forecast of total 2019/20 U.S. wheat exports is 26.4 MMT, up 3% from last year, pending final results. Adjustments in commercial sales are often made as the marketing year ends.

• This week’s commercial sales for delivery in 2020/21, through May 28, totaled 437,000 MT. Year-to-date commercial sales for delivery in 2020/21 total 3.47 MMT, 18% behind last year’s new marketing year pace.

• The USW Commercial Sales Report now features new marketing year export sales information by class, destination and marketing year. USW will publish new marketing year information until June 11, 2020.

• Click here to view the most recent USW Commercial Sales report.

U.S. Drought Monitor

• Hot, dry weather increased drought stress across the western Great Plains. Abnormal dryness spread in western South Dakota, western Nebraska and eastern Wyoming. Moderate drought increased in the Texas Panhandle and extreme drought spread in eastern Colorado and the Oklahoma Panhandle. Beneficial precipitation reduced dryness in eastern Washington. Looking ahead, dry weather is expected to persist across the western Great Plains. Warmer temperatures, heavy precipitation and potential flooding are expected in the Mississippi Valley following Tropical Storm Cristobal.

• Warm, dry winter conditions increased the pace of Ukrainian winter wheat development and farmers are expected to get an early jump on the 2020/21 harvest. According to APK Inform, a Ukrainian agriculture consultancy, the Ukrainian wheat harvest started several days earlier than last year. Ukrainian farmers are now expected to produce 23.2 MMT of wheat in 2020, 18% less than last year because abnormal winter conditions persisted into the spring, pressuring crop production estimates. Total wheat exports are expected to fall 25% on the year to 14.9 MMT.

• Australian wheat production and export estimates for the 2020/21 marketing year are well above last year as beneficial precipitation supported planted area and crop development. “While it’s still around six months until the grain is in the bin, all the hallmarks of an above-average season are now falling into place,” said Cheryl Kalisch-Gordon, senior grains analyst at Rabobank. According to Rabobank, wheat planted area is up 33% on the year and total wheat production is expected to reach 24.0 MMT, up 58% from last year, if realized. USDA expects Australian wheat exports could reach 15.0 MMT in 2020/21, 83% greater than last year, if realized.

• Kazakhstan’s Ministry of Agriculture now estimates the country’s 2020/21 wheat output will jump 18% from last year to 13.5.0 MMT on increased planted area and favorable spring wheat planting conditions. USDA expects Kazakh wheat exports will reach 6.60 MMT in 2020/21, up 14% from last year, if realized.

• Argentinian wheat planting for the 2020/21 season jumped week-over-week to 30% complete as farmers took advantage of dry weather ahead of weekend rains, the Buenos Aires Grain Exchange (BAGE) said in its weekly crop report. Production is now estimated at 21.0 MMT from a planted area of 6.80 million hectares (16.8 million acres).

Baltic and U.S. Dollar Indices

• The Baltic Dry Index (BDI), an assessment of the average cost to ship raw materials like grains, coal and iron ore, jumped 25% on the week to end at 632.

• The U.S. Dollar Index fell 2% from last week’s 99.06 to end at 96.95.