Pre-Opening Wheat Market Report for 9/24/2010
Related Keywords: Agriculture Email Print | December wheat was 6 cents higher overnight. The dollar was mostly lower. December wheat staged a partial recovery overnight from yesterday’s sharp sell off. This came as the dollar moved back near its recent lows and concerns continued over wheat prospects in Western Australia. One major forecaster is calling for the Western Australia wheat crop to drop by up to 4 million tonnes. This would be about half of last year’s production, although these losses could be partially offset by gains in eastern Australia. Traders there are also reporting a shortage of high-quality wheat out of Western Australia, which is causing a rise in premiums. More favorable conditions in Argentina have alleviated concerns there somewhat, but some areas need more rain. India expects its summer-sown rice production to be up 5.9% over last year to 80.4 million tonnes. This is due to improved monsoon rains in recent weeks. However, India’s Farm Minister said that he has no plans to lift the current ban on exports of wheat and rice despite overflowing storage facilities and higher world prices. Weekly export sales came in at 950,300 tonnes for the current marketing year and minus 490,500 tonnes for next year for a total of 459,800. Cumulative wheat sales stand at 48.4% of the USDA forecast for 2010/2011 versus a 5 year average of 51.3%. Sales need to average 476,000 tonnes each week to reach the USDA forecast. The EU cleared export licenses for 527,000 tonnes of wheat during the latest reporting week. This takes the total for the marketing year to-date to 5.3 million tonnes versus just 4.2 million at the same point last year. Some sources in Europe are projecting that the EU may be sold out in terms of an exportable wheat surplus by the end of the calendar year. December wheat posted a sharp loss yesterday credited to technical and fund selling that accelerated after a push below the 700 level. A higher dollar and selling by spreaders versus corn also contributed to the day’s weakness.