With the March contracts rolling off the board don’t take a lot of notice of the nearby futures numbers.
It is encouraging to see the May 19 contract for SRW at Chicago up US5.5c/bu (AUD$2.88) but the guys growing HRW must be starting to wonder why they are bothering. The spread between SRW and HRW remains well and truly in favour of the lower grade in the US. SRW May settled at US$4.5275 per bushel while HRW futures for the same month closed at US$4.365 / bu. That’s a negative spread of 16.25c, almost AUD$9.00 lower for HRW.
It appears the funds had their minds set on further “technical buying” in last night’s US wheat futures. The lead up to the session had the US weekly export sales report as the main driver. So to see a sales report come in at only 263kt versus a low side estimate prior to the reports release of 400kt one would have generally expected to see futures get hammered. Weekly export loadings were pretty good though, at 743kt, I guess they have a report to suite their book if they look hard enough.

Algeria picked up 450kt of French wheat for April / May. The winning tender values were said to have been between US$231 and US$234 per tonne CFR, that’s a hefty fall from their last tender. French wheat has fallen some US$6.00 in recent weeks as the EU block continues to compete and in many cases undercut the Black Sea suppliers.