Chicago SRWW saw steady gains in overnight trade, HRWW and Spring Wheat were more subdued, HRW moving just 0.75c/bu higher on the nearby. Good weekly US export sales were the key driving force behind the move. At 532kt is the highest weekly US sales total in six weeks. Asian customers dominated the sheet, Philippines picking up 97kt and S.Korea 93.4kt. US wheat remains very competitive out of the PNW into the Asian market but the gap between US and Aussie values is narrowing. Basis yesterday falling from 38c/bu to 31c/bu.
Other positive news came from the Russian spring wheat region. Omsk oblast has declared a state of emergency after heavy rain. Rain has persisted across much of the spring wheat region of Russia and Kazakhstan this season. Many analyst had already started to question both yield potential and quality of the spring wheat crop there. WorldAgWeather.com shows rainfall of 200%-400% above normal over the last 14 days.
Roughly 13% of the Russia wheat crop is spring wheat, 10mt-11mt, the Omsk region is the second largest spring wheat producing region, production was expected to be around 1.2mt to 1.5mt, so if there’s a loss of say 30% it’s potentially less than 500kt off the sheet. Not a lot and probably countered somewhat by the ideal conditions being experienced across Australia. Being spring wheat though, it will be potentially be half a million tonnes off the higher grade milling ledger and potentially a portion of that will be durum wheat.
Wheat futures were not the only market higher overnight, Paris milling wheat +€2.50 Dec, London feed wheat +£1.05 Jan, Chicago soybeans +14.25c/bu in the Jan and soybean oil and meal were all higher. Paris rapeseed and Winnipeg canola saw good gains, the later closed up C$23.30 / tonne in the Jan slot. Cash bids for canola out of SE Sask were also higher, a Dec lift seeing day to day gains of C$23.30 in line with futures. Nearby cash bids for canola out of SE Sask were up C$25.90 to C$555.65 ex farm on average according to PDQ. Chicago soyoil appears to be key to the rally in oilseed values.
Still across SE Sask, spring wheat saw gains at the farm gate of C$5.32 for a Dec lift.