US hard red winter wheat futures lead the US wheat market higher last night. There were good gains to be made across all grades in both cash and futures. Cash FOB HRWW out of the US Pacific Northwest jumped roughly AUD$15.94/t compared to yesterday’s conversion.
Canadian spring wheat out of SE Saskatchewan rallied CAD$8.08/t for a December lift. The day to day conversion comparison for French milling wheat FOB Rouen didn’t miss a beat either, that conversion is up AUD$17.74/ tonne this morning.
The only milling wheats to really slip away were Ukraine and Russian. Although these wheat values fell at the FOB level, a delivered importer price was higher. Offers reflecting the additional cost of execution since the risks are now much higher for shipping firms to pass through the Black Sea ports.
New crop Argie milling wheat roughly lands into Asia in December for US$25.00 more than Aussie H2 wheat. Converted grower bids for new crop H2 here are also around $US14.00 lower than US HRWW into the Asian market.
The only thing spoiling the show at the moment is the lack of demand. A sharp rally in US wheat futures isn’t going to help that. Nor is the better season a few of the major N.African consumers had. Big consumers, like Algeria, may well wait until the last moment to tender,hoping Black Sea wheat access becomes better. In the meantime we see France, Germany and Poland all pulling production numbers back. Canada is either too wet or too dry depending on where you look, and the US G/E rating for spring wheat slipped considerably week on week.
That leaves the southern hemisphere guys to pick up the slack. Argentina is currently about 3/4 of the way through sowing. Rainfall for Argentina over the last 30 days has generally been a little less than desired. This has allowed sowing to progress pretty much uninterrupted for many into a mostly good seed bed and moisture profile. Like much of eastern Australia there is little rain predicted for Argentina in the short term forecast. El Nino usually produces better rain in Argentina, currently this does not appear to be the case.