The 2019 wheat crop tour in the USA got underway yesterday and will conclude on Thursday evening US time. I’m not sure what they will do to determine yields this year with only around 5% of the crop expected to be in head by the end of the week. The USDA have the Kansas HRWW crop rated as 58% good to excellent so we should probably expect to see yield estimates a little above average. Disease reports from the tour will be the most interesting information available.
Hard red wheat futures at Chicago shed another 10c a bushel in overnight trade. This brings July down to 397c now US$145.87 / tonne, or AUD$206.75 / tonne. On the cash market HRW is offered out of the Gulf at US$200. Out of the Pacific Northwest US soft white wheat is offered at roughly US$224 / tonne. This would move to Japan for roughly US$24 so CnF Japan US$248. Western Australian APW1 is offered up at US$226 but only has a US$4.00 freight advantage to Japan over US wheat making a CnF offer at Japan equivalent to about US$246 / tonne, to you and I this would equate to a NTP Newcastle bid of roughly AUD$199 for APW1. Kind of makes that AUD$360 delivered Downs for new crop SFW1 wheat look pretty good doesn’t it.
Saudi Arabia picked up 620kt of wheat at US$233.72 CFR, roughly US$14 less than their last tender. This would be equivalent to about AUD$176 NTP Newcastle. The wheat purchased needs to be above 12.5% protein milling wheat for delivery July – September.