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- Technical buying and broad strength in the U.S. grains complex on Midwestern dryness supported all wheat futures prices week-over-week. CBOT soft red winter (SRW) futures ended 12 cents up on the week at $5.39/bu. KCBT hard red winter (HRW) futures gained 16 cents to close at $4.61/bu. MGE hard red spring (HRS) futures added 3 cents to end at $5.18/bu. CBOT corn futures added 19 cents to close at $3.46/bu. CBOT soybean futures gained 50 cents to end at $9.50/bu.
- Limited elevation capacity on strong, continued corn and soybean exports to China and high rates in the domestic secondary rail market supported Great Lakes and Gulf HRS, Gulf HRW, Gulf SRW and Pacific Northwest (PNW) HRW export basis for September and October deliveries. Quick progress of the Montana spring wheat harvest and higher futures prices pressured PNW HRS export basis week-over-week.
- The 2020 U.S. winter wheat harvest is nearly complete with only crops in Montana and the PNW left to cut. PNW HRW conditions remain good and above-average yields are expected. The PNW soft white (SW) harvest made strong progress this week on favorable field conditions. Farmers in Washington have harvested 82% of the expected crop. Idaho’s SW crop is 83% harvested and Oregon’s SW harvest is 96% complete. The SRW harvest is over and preliminary lab samples show strong end use qualities, with higher test weights and falling number values than last year.
- Total U.S. spring wheat crop ratings remained steady week-over-week at 71% good to excellent as of Aug. 24. Generally dry, favorable weather across the Northern Plains is helping advance the 2020 U.S. spring wheat harvest; approximately 60% of the spring wheat crop is now in the bin, up from last week’s 40%.
- Click here to read more about the 2020 U.S. wheat harvest.
- This week’s commercial sales of 764,000 metric tons (MT) for delivery in 2020/21, as of Aug. 20, were up 46% from last week’s 523,000 MT and above trade expectations of 400,000 MT to 700,000 MT. Year-to-date commercial sales now total 11.9 million metric tons (MMT), 7% ahead of last year’s pace. USDA expects the United States will export 26.5 MMT of wheat in 2020/21, up 1% from last year, if realized.
- Click here to view the most recent USW Commercial Sales report.
- This week, abnormal dryness spread across eastern Montana, western North Dakota, most of South Dakota and central Nebraska. Severe drought extended into northeastern Colorado. As of Aug. 25, all of eastern Colorado, where a majority of the state’s wheat is grown, and western Kansas are under severe to extreme drought. Continued dryness in this region could pose serious challenges for winter wheat farmers as they prepare for fall seeding. Looking ahead, rainstorms across the Northern Plains could delay the spring wheat harvest by a couple of days, but are not expected to impact crop quality, said a U.S. grain trader.
- Official European Union (EU) data on Aug. 25 showed that EU and British soft (non-durum) wheat exports for the 2020/21 marketing year totaled 1.99 MMT, down 47% from the same time last year.
- More than half of the 3.95 million acres (1.6 million ha) of wheat planted in Argentina’s main wheat-producing regions is in poor condition after recent frosts and dry conditions, said a report by the Rosario Grain Exchange (BCR). BCR forecasts wheat yields in that region could decline by up to 50% if beneficial precipitation doesn’t fall over the next couple of days. BCR forecasts final Argentinian wheat production in 2020/21 could fall to 18.0 or 19.0 MMT, in line with last year but significantly lower than the exchange’s initial forecast of between 21.0 and 22.0 MMT.
- Russian farmers have harvested 67.4 MMT of wheat as of Aug. 25, 18% ahead of this time last year. According to the country’s Ministry of Agriculture, the total average yield is up slightly this year at 53.3 bu/acre (3.58 MT/ha).
- According to Agriculture and Agri-Food Canada (AAFC), durum planted area for harvest in 2020 increased 16% on the year and production is expected to increase 30% from 2019/20 to 6.50 MMT. Durum exports are expected to remain stable year-over-year at 5.30 MMT. Canadian non-durum wheat planted area fell 3% from last year as 5% decrease in spring wheat planted area more than offset a 17% increase in winter wheat planted area. Despite lower planted area, non-durum wheat production is expected to increase 4% from 2019/20 to 28.4 MMT. AAFC forecasts Canadian non-durum wheat exports could increase 2% on the year to 19.1 MMT.
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 increased slightly from last week to end at 1,504.
- The U.S. Dollar Index fell from last week’s 93.24 to close at 93.32.