- Technical buying and continued dryness in Russia supported all wheat future prices week-over-week. CBOT soft red winter (SRW) futures added 7 cents to close at $6.33/bu. KCBT hard red winter (HRW) futures gained 11 cents to end at $5.70/bu. MGE hard red spring (HRS) futures jumped 18 cents to close at $5.77/bu. CBOT corn futures added 17 cents to end at $4.19/bu. CBOT January soybean futures gained 31 cents to close at $10.81/bu.
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VIEW HERE Gulf SRW export basis and Pacific Northwest (PNW) soft white (SW) export prices increased for December and January deliveries on extremely limited elevation capacity. Gulf and PNW HRS export basis remained steady and high for nearby and deferred deliveries.
- According to USDA, U.S. farmers have now planted 77% of the total intended winter wheat area for harvest in 2021, up 9 points on the week. That is 3 points ahead of this time last year and 5 points ahead of the 5-year average. As of Oct. 19, 51% of the country’s winter wheat has emerged, led by Nebraska at 72% and South Dakota at 71%.
- U.S. Wheat Associates (USW) is pleased to announce publication of the 2020 Crop Quality Report. The report is now available online in English, Spanish, French and Italian. Arabic, Chinese and, for the first time, Portuguese, are expected in early November. With essential, objective information to help buyers get the wheat they need at the best value possible, we hope you find this report valuable. In addition to the Crop Quality Report, we are sharing regional quality reports from our partners and additional U.S. crop quality resources.
Commercial Sales
- This week’s commercial sales of 367,000 metric tons (MT) for delivery in 2020/21, as of Oct. 15, were 31% below last week’s 528,000 MT and on the low end of trade expectations of 200,000 MT to 800,000 MT. Year-to-date commercial sales now total 15.4 million metric tons (MMT), 9% 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, beneficial precipitation alleviated areas under moderate drought in western Montana, however most of the Northern plains remain abnormally to severely dry. Moderate drought to severe drought spread from northwestern Kansas to the Texas Panhandle. Extreme drought now covers most of the Nebraska Panhandle and eastern Colorado. To date, nearly all the winter wheat producing regions in the Great Plains are abnormally to extremely dry. According to DTN, dryness is stressing wheat in the Southern Plains. Kansas winter wheat conditions are 31% good to excellent compared to 55% a year ago. Wheat is likely to go into dormancy with on-going dryness and drought issues. No precipitation is forecast across the Southern Plains while scattered snow is expected to alleviate dryness across parts of the Northern Plains.
- As of Oct. 21, Ukrainian farmers have planted 4.60 million hectares (11.4 million acres) of winter wheat for harvest in 2021, or 76% of the total intended area. According to Reuters, weather in Ukraine have been the worst in 10 years and only 10% to 15% of arable land was suitable for sowing winter crops for the 2021 harvest due to severe, prolonged drought.
- Rabobank estimates the 2020/21 Australian wheat crop will rebound 91% on the year to 28.8 MMT, slightly above USDA’s forecast and only 9% below the 2016/17 record, if realized. Wet weather could challenge harvest progress across southern Queensland and northern New South Wales, says Australian newspaper Queensland Country Life. “The threat of storms and rain has turned the 2020 harvest into a race against nature to get the crops harvested and into storage before the inevitable major rain event,” the newspaper reported on Oct. 22.
- The Buenos Aires Grain Exchange (BAGE) cut its 2020/21 Argentina wheat production estimate by 700,000 MT to 16.8 MMT, 11% less than last year, if realized, on persistent dryness. According to BAGE, Argentinian farmers have now begun the wheat harvest and 3% of the crop is in the bin.
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 5% on the week to end at 1,401.
- The U.S. Dollar Index fell from last week’s 93.68 to close at 92.76.