US futures found support in the row crops while wheat was generally a little lower after recent gains triggered some profit taking. Corn in the US has been considered cheap for a while now and recent gains in corn and losses in wheat are starting to narrow the spread. Traditionally we see a corn wheat spread of around 65c – 85c, presently we see the spread at 136c.

Pressure on wheat is also coming from the global market. Recent sales out of the Black Sea region have drifted lower. Milling wheat out of the Black Sea is offered at US$209 FOB while 12.5% protein is offered at US$211.50 which is basically about where the 11.5% product was a few weeks ago. Tunisia is tendering for 117kt of milling wheat. Ocean frieght from Russia to Tunisia will cost about US$18. So Russian wheat could land there for about US$227. In their last tender Tunisia picked up tonnage at US$233+.

Ethiopia raised the volume of wheat they are looking to buy to 600kt with the issue of a second tender for 400kt this week. Offers are coming in at about US$214 – US$223 depending on delivery date, buying agency and delivery location.

Japan picked up 117kt of wheat yesterday, the bulk of the order was US wheat spread between soft white wheat, HRWW and spring wheat. They also grabbed a cargo of Canadian spring wheat and one of ASW from Australia.