Prices 9/5/19


Overnight saw some limited downside for wheat at London, Paris and American grain futures markets. We have May closing out and a USDA report due out on Friday. Cash markets were generally flat to lower with Black Sea wheat offered at US$204 FOB against a bid of US$198 FOB. There’s no recognition in the Black Sea wheat market for 11.5% protein versus 12.5% protein at present, this is a little disturbing. If we see Canadian acres increase as expected and they also manage to pull off a good quality crop we may start to see new crop grade spreads erode in Australia, not that there is anyone putting a new crop milling wheat spread number out there anyway.

South Korea picked up 120kt of feed wheat overnight at US$204.29 / US$204.75 per tonne. For the sake of the exercise let’s call it US$205 per tonne. This would work back to a feed wheat number NTP Newcastle of roughly AUD$240.
White wheat out of the Pacific Northwest USA continues to be offered at a premium to Western Australia, US$220 FOB vs US$213 FOB. The WA number is interesting given the current bid for APW out of say Albany is AUD$251 FIS which at a FOB level is even lower than US$213 by roughly US$20.

Friday’s USDA report will include their first stab at the 2019-20 crop production. Most punters are lining up with world wheat production coming in at about 276mt. EU is expected to come in around 141mt, Russia about 82mt and Ukraine is there at roughly 28mt.