It’s seven session in a row for US wheat futures, yep, for the last seven days CBOT wheat has closed higher than the previous days settlement. Since last Tuesday soft wheat is up 33c.bu on the nearby contract, that’s roughly $16 per tonne.
For the same period our APW1 bid actually fell $4.00 / tonne. Currency has had a fair bit to do with that though as it jumped from 71.37c to 74.81c during the same time frame, that’s roughly $11.00 / tonne worth of currency moves countering the upside. It still means that $9 worth of basis has been eroded, looking out the window you may be asking yourself why.
Earlier this week the EU Commission said that with northern hemisphere crops looking good, spring plantings up to 75% quicker than last year and no significant change expected in the current weather pattern there is no fundamental reason for cereal and feed grain prices to increase. To help counter the move in US futures values we also see data showing that exports out of Frances main port of Rouen have slipped well below what they need to be in order for France to achieve its export projections for 2016. We are likely to see ending stocks build in both the EU and the USA in coming reports.
NCDEX chickpea futures closed sharply higher in overnight trade, we could see up to $30 upside if reflected 100%.