18/6/25 Prices

18/6/25 Prices

The recovery in US wheat futures overnight was said to be in reaction to the lower than expected condition rating of US winter wheat in Monday evenings crop progress report. I can’t help but think that this condition rating is more likely to decline further as opposed to improving. The condition rating for Oklahoma for […]

The recovery in US wheat futures overnight was said to be in reaction to the lower than expected condition rating of US winter wheat in Monday evenings crop progress report. I can't help but think that this condition rating is more likely to decline further as opposed to improving. The condition rating for Oklahoma for example improved. It's hard to believe that 2 weeks of less than ideal harvest weather where 80mm to 180mm of rain has fallen is encouraging an improvement for standing, mature wheat. How often do you see drought turn to flood. https://www.youtube.com/watch?v=ATO8LUne4YE Unless you are punting basis or US futures the overnight rally may only result in a small impact on local wheat prices here. This is further discussed in the domestic analysis, basis has been absorbing much of the US / Canadian volatility this quarter. The forecast for the Canadian Prairies is also looking much better. Showers across Alberta and Saskatchewan are expected to become more generalised over the weekend possibly producing falls of 20-50mm across the spring wheat and durum belt. Further north in Alberta, canola country, producers may see falls as heavy as 100-150mm if the forecast is correct. The Canadian market continues to reflect the volatility in US futures. Overnight spring wheat values out of the US Pacific Northwest and Vancouver were firmer. The day to day conversions, when taking the weaker AUD into account, convert back to gains of almost AUD$6.00 / tonne in the new crop. Old crop HRWW out of the US PNW, converted to a CiF Asian buyer, is now bang inline with H2 values using the same consumer base. One would normally expect to see white wheat at a premium to red wheat, currently this is not the case when considering grower bids for both grades. The weaker AUD came to the rescue overnight, helping most grains by $2.00 to $4.00 prior to seeing any assistance from the rally in physical grain values. Local markets failed to reflect a similar rally on Friday, so there's a pretty good chance we'll see weaker basis here again today, particularly in old crop wheat.