- After climbing each week for more than a month, all futures prices closed lower for the week CBOT soft red winter (SRW) futures shed 46 cents to close at $7.27/bu. KCBT hard red winter (HRW) futures were down 76 cents to end at $6.51/bu. MGE hard red spring (HRS) futures dropped 44 cents to close at $7.45/bu. CBOT corn futures dropped 87 cents to end at $6.85/bu. CBOT soybean futures shed 18 cents to close at $16.03/bu.
- Basis in the Gulf remains steady. Farmer selling has increased due to higher domestic demand, but high futures prices dampened export demand. In the PNW, farmer engagement was less, but light export demand kept basis steady. Soft white wheat basis, however, was raised due to minimal supply and poor weather prospects.
- USDA reported U.S. winter wheat conditions did not change much this week. Winter wheat reported as good or excellent was 48%, 1% behind last week’s rating. USDA reported that the southern plains HRW crop was over 67% headed as of May 9. U.S. spring wheat for harvest in fall 2021 is 70% planted, well ahead of the 51% five-year average. Spring wheat emergence is 29%, 9 points ahead of the five-year average. Read more in the first U.S. Wheat Associates 2021 Harvest Report.
- In the 50th week of marketing year 2020/21, U.S. wheat commercial sales of 30,300 metric tons (MT) were below trade expectations of 49,700 MT to 53,783 MT. Year-to-date commercial sales for delivery in 2020/21 total 25.5 million metric tons (MMT), 7% lower than last year. USDA expects total 2020/21 U.S. wheat exports will reach 26.2 MMT even with last year if realized.
- This week’s commercial sales for delivery in 2021/22 totaled 268,000 MT.
- View the most recent USW Commercial Sales report here.
U.S. Drought Monitor
- Drought conditions deteriorated in much of the northwest, including Oregon, Washington, Idaho, and Montana. The region experienced its third driest April on record. North Dakota recorded its driest 9-month period on record, and Colorado recorded its driest 12-month period on record. Areas of north-central Texas saw minor improvements after the rain this week, but the Texas Panhandle saw worsening drought conditions.
- Stratégie Grains, a French grain consultancy, left its monthly European Union soft (non-durum) wheat production forecast unchanged. Despite a 0.5 MMT reduction in French production, good field conditions in Romania led the firm to raise the wheat forecast there, offsetting the French reduction. Stratégie Grains forecast a 129.6 MMT soft wheat crop in 2021/22, up 8.5% compared to 2020/21.
- The Rosario Grain Exchange (BCR) said this week that Argentina’s wheat crop will be a record 20.0 MMT following a 3%increase in planted area. However, many growing regions need between 50 mm to 80 mm (2 inches to -3 inches) of rain to improve soil moisture levels.
- There is discrepancy in forecasts of Russia’s 2021 wheat crop. SovEcon, a Russian agriculture consultancy, raised its forecast by 1.0 MMT to 81.7 MMT due to a larger than expected harvest area. The May USDA World Agricultural Supply and Demand Estimates (WASDE) report pegged Russian wheat production at 85.0 MMT. In addition, a GAIN report from USDA’s Foreign Agriculture Service Attachè forecasts Russian wheat production to be 77.5 MMT
Baltic and U.S. Dollar Indices
- The Baltic Dry Index (BDI), an assessment of the average cost to ship raw materials such as grains, coal and iron ore, dropped 3% on the week to end at 3,077.
- The U.S. Dollar Index decreased from last week’s 90.56 to close at 90.31.