Technical Tuesday, call it what you will. After a fairly bullish few days the Chicago wheat pit gave back 26c/bu on the nearby contract last night. This leaves the “rally” from the recent USDA report at just 7.5c/bu (AUD$3.79) hardly worth the fanfare was it. Fundamentally the market remains more bullish than bearish. Although the global wheat stocks to use ratio is still much higher than most producers would like to see it the market does appear happy with where current prices are.

With temperatures across the US spring wheat belt are some 5C hotter than average combined basically zero rainfall over the last seven days harvest progress is rapid. Lower yields are also allowing for a quick harvest. Much of southern Saskatchewan is in the same boat. Looking at the cash bid at Minneapolis we see an increase in value by 20.25c/bu in comparison to a decline in nearby MGEX futures of 21c. Cash is priced at 1072c/bu, this tells me someone is happy to buy, in the middle of harvest, at the MGEX anyway. Cash bids out of the PNW for DNS 14% wheat were flat to lower. A December lift was bid on average at 10.45c/bu. On the back of an envelope, using Japan as a buyer this would compare to an Aussie port price of something close to AUD$490.
Durum bids across SE Saskatchewan continue to rally, up another C$11.34 / tonne for a Dec lift last night. The average cash price there came in at C$606.89 ex farm. Execute this from the PNW to Japan and it converts to an Aussie port price equivalent to well over AUD$700 per tonne using basis to FOB of just C$100. Recently basis from SE Sask for durum to the PNW has been as high as C$170+.