Wheat futures in the USA took back much of Friday night’s decline as funds stood up to take end of month profits from extended short positions. Harvest pressure kept corn and soybeans futures in check but the US does continue to sell good volume of beans to  China. Some punters claimed the drier conditions in the US hard red wheat belt was also supportive of wheat values.

G3 (the old Canadian Wheat Board) increased their pool return outlook numbers for durum late last week. Wet weather has seen some serious issues with the Canadian durum crop and cash prices had moved higher over the course of October. The jump in price did take a few punters by surprise, a move of C$45 / tonne is significant. The increase takes CWAD1, the top grade, to C$380 / tonne FOB.
With around 13% of the durum crop still in the field we could also see some productions reductions in the next Stats Canada report although this was not the case in the latest IGC report which actually increased Canadian durum production by 300kt to 7.3mt, 800kt above the 2013 record. Good demand from the major importers and North Africa should see good premiums for DR1 continue through to next year. C$380 FOB Vancouver + freight to Nth Africa is about US$321, so roughly $360 NTP Newcastle equivalent, we usually extract around an additional $25 for quality, so potentially $385 at present, if quality gets tighter look for  further gains.