- Technical selling pressured all wheat futures prices week-over-week. CBOT soft red winter (SRW) December futures ended 8 cents down at $5.42/bu. KCBT hard red winter (HRW) December futures lost 1 cent to close at $4.71/bu. MGE hard red spring (HRS) December futures fell 10 cents to end at $5.32/bu. CBOT December corn futures gained 10 cents to close at $3.68/bu. CBOT January soybean futures added 26 cents to end at $9.99/bu.
- Increased export demand supported soft white (SW) wheat export prices week-over-week. The strong pace of U.S. agricultural exports to China continues to support Gulf and Pacific Northwest (PNW) HRW and HRS export basis values.
- The 2020 U.S. HRW and SRW harvests are officially complete and preparations for the 2021 crop have now begun. The PNW SW harvest made strong progress this week on favorable field conditions. Farmers in Washington have harvested 95% of the expected SW crop. Idaho’s SW crop is 99% harvested and Oregon’s SW harvest is now complete.
- Approximately 88% of the HRS crop is now harvested with South Dakota more than 97% complete, Minnesota 94% harvested, Montana 84% finished and North Dakota 76% complete. Overall, producers are reporting average to above average yields across the growing region. No major harvest or quality issues have been reported thus far. Warmer weather next week is expected to enhance spring wheat harvest across the Northern Plains.
- Click here to read more about the 2020 U.S. wheat harvest.
Commercial Sales
- This week’s commercial sales of 484,000 metric tons (MT) for delivery in 2020/21, as of Sept. 3, were down 17% from last week’s 585,000 MT but within trade expectations of 250,000 MT to 600,000 MT. Year-to-date commercial sales now total 12.9 million metric tons (MMT), 8% ahead of last year’s pace. USDA expects the United States will export 26.5 MMT in 2020/21, up 1% from last year, if realized.
- Click here to view the most recent USW Commercial Sales report.
- This week, cooler temperatures and substantial, beneficial precipitation alleviated areas under extreme drought in eastern Colorado and western Kansas, though these changes were not reflected in the Sept. 10 Drought Monitor. Recent precipitation is expected to enhance the region’s winter wheat planting campaign. Severe drought spread across western Nebraska and pockets of extreme drought emerged in western Wyoming. Looking ahead, beneficial rainfall is expected to alleviate dryness from western Oklahoma to central Texas.
- In its September World Agricultural Supply and Demand Estimates report, USDA increased its production forecasts for Australia and Canada. Beneficial rainfall over the past several months pulled Australia out of a historic, three-year drought. USDA now forecasts Australian wheat production will reach 28.5 MMT, up 10% from its August prediction and 87% more than the country’s 2019/20 output, if realized. Total Canadian wheat production is expected to reach 36.0 MMT, up 6% from USDA’s August forecast and up 11% from last year, if realized.
- Click here to read USDA’s September WASDE report.
- Reuters reported that recent precipitation in Argentina has helped revive the country’s drought stricken wheat crop. “The rains arrived just in time to put a floor under the damage that was being done to wheat yields,” said the Buenos Aires Grain Exchange’s (BAGE) chief analyst Esteban Copati. However, USDA reduced its Argentinian wheat production forecast from 20.5 MMT in August to 19.5 MMT in September, slightly lower than last year, if realized.
- According the Russia’s Ministry of Agriculture, Russian farmers have harvested 78.8 MMT of wheat as of Sept. 9, 24% more than this time last year. The average yield is up slightly this year at 48.0 bu/acre (3.23 MT/ha). SovEcon, a Russian agriculture consultancy, increased the country’s wheat production forecast from 82.6 MMT last month to 83.3 MMT on Sept. 10. USDA expects Russian wheat output will reach 78.0 MMT, unchanged from the August forecast, but 6% more than last year, if realized.
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 fell 7% to end at 1,269.
- The U.S. Dollar Index jumped from last week’s 92.71 to close at 93.26.