Wheat futures in the US continued higher. Fuelled by the USDA report and technical buying. Looking at the charts it’s a pretty steep line at present but still pushing through neutral on its way to overbought. Keep an eye on a slowing of purchases or a short term top early next week. There’s no guarantee our local cash price will follow the lead in US futures but even if it gives us back $5.00 – $10 of the recent fall it will be better than a poke in the eye with blunt stick. In simple terms last night’s move in US futures, if reflected fully, is equivalent to about $8.50, so maybe we’ll see a couple of dollars and weaker basis come Monday.

The yet to be traded APW1 FOB Australian FOB Platts wheat contract at Chicago settled at US$259.50 for a Feb21 slot. Roughly equivalent to about AUD$270 ex farm LPP, nice selling of you could get it. The cash bid at Gunnedah silo for APW1 was $243 yesterday, executed and free on board a boat that would equate to about AUD$320, the Platts contract is about AUD$344. The ASX for Jan21 was equivalent to AUD$236.50 Gunnedah or AUD$311 FOB. These estimates are hard to determine these days as the Fobbing costs, rail rates, site costs, just about every transaction down the supply chain is negotiable and then you toss in arbitrage.

Russia continues to consider a wheat export tax rumoured to be valued somewhere around US$27.30 per tonne. Combining this tax with a quota system for exports is expected to help curb increasing domestic food costs. 12.5% protein wheat was priced at US$252 FOB.