Agriculture equipment maker Deere & Co. (NYSE:DE) said on Wednesday they see corn prices dropping for 2012-2013, along with the price of soybeans, cotton and wheat.
Using a date for the starting the year of September 1, Deere said they see corn prices falling on average to $5.30 a bushel for 2012-2013, down from the average of $6.40 a bushel in 2011.
Soybeans are expected to drop significantly by Deere, with estimates of price per bushel falling from $13 a bushel in 2011 to $10.50 a bushel for 2012-2013. That's down from the November estimate of $11.25 a bushel.
For wheat, Deere sees prices dropping from $7.40 a bushel in 2011 to an average of $6.70 a bushel for 2012-2013. That's a little up from the November estimates of $6.60 a bushel for wheat.
Cotton is forecast to plummet from 88 cents a pound in 2011 to 75 cents a pound on average for 2012-2013.
Showing posts with label Wheat Prices. Show all posts
Showing posts with label Wheat Prices. Show all posts
Thursday, February 16, 2012
Thursday, May 5, 2011
CF Industries (CF) (IPI) (TNH) (AGU) Trade Down as Wheat, Soybeans Plunge
Fertilizer companies CF Industries (NYSE:CF), Intrepid Potash (NYSE:IPI), Terra Nitrogen Company, L.P. (NYSE:TNH) and Agrium (NYSE:AGU) were under pressure Wednesday, closing down on the day as wheat and soybean prices plummeted. Corn prices were able to generate a gain on the day.
In July agriculture contracts, wheat was down 21.25 cents to settle at $7.72 a bushel. Soybeans dropped 11.75 cents to settle at $13.52 a bushel.
Corn climbed 5.75 cents to settle at $7.295 a bushel.
Wheat and corn are expected to jump by about 5 cents to 10 cents over the next couple of days.
Companies supplying fertilizer will usually move in unison with the direction crop prices are going, as it is an indicator of the level farmers will spend on inputs.
Agrium (AGU) closed Wednesday at $84.02, falling $3.75, or 4.27 percent.
In July agriculture contracts, wheat was down 21.25 cents to settle at $7.72 a bushel. Soybeans dropped 11.75 cents to settle at $13.52 a bushel.
Corn climbed 5.75 cents to settle at $7.295 a bushel.
Wheat and corn are expected to jump by about 5 cents to 10 cents over the next couple of days.
Companies supplying fertilizer will usually move in unison with the direction crop prices are going, as it is an indicator of the level farmers will spend on inputs.
Agrium (AGU) closed Wednesday at $84.02, falling $3.75, or 4.27 percent.
Potash (POT) (CMP) (MOS) (SYT) Trade Down as Wheat, Soybeans Prices Plunge
Fertilizer companies Compass Minerals (NYSE:CMP), Mosaic (NYSE:MOS), Syngenta (NYSE:SYT), Potash Corp (NYSE:POT) were under pressure Wednesday as wheat and soybean prices plummeted. Corn prices were able to generate a gain on the day.
In July agriculture contracts, wheat was down 21.25 cents to settle at $7.72 a bushel. Soybeans dropped 11.75 cents to settle at $13.52 a bushel.
Corn climbed 5.75 cents to settle at $7.295 a bushel.
Wheat and corn are expected to jump by about 5 cents to 10 cents over the next couple of days.
Companies supplying fertilizer will usually move in unison with the direction crop prices are going, as it is an indicator of the level farmers will spend on inputs.
Potash closed Wednesday at $53.42, falling $0.77, or 1.42 percent.
In July agriculture contracts, wheat was down 21.25 cents to settle at $7.72 a bushel. Soybeans dropped 11.75 cents to settle at $13.52 a bushel.
Corn climbed 5.75 cents to settle at $7.295 a bushel.
Wheat and corn are expected to jump by about 5 cents to 10 cents over the next couple of days.
Companies supplying fertilizer will usually move in unison with the direction crop prices are going, as it is an indicator of the level farmers will spend on inputs.
Potash closed Wednesday at $53.42, falling $0.77, or 1.42 percent.
Monday, May 2, 2011
Potash (POT) (SYT) (MOS) (CMP) Driven up by wheat, Corn Profits
Wheat and corn prices continue to drive the profits of farmers up, resulting in capex from them toward companies like Potash Corp (NYSE:POT), Syngenta (NYSE:SYT), Mosaic (NYSE:MOS) and Compass Minerals (NYSE:CMP).
How quickly the griping from farmers has subsided since the worst of the recession when they were complaining about high input costs.
The U.S. will control 28 percent of global wheat exports in 2011, an increase from 18 percent in 2010, according to the U.S. Department of Agriculture. With prices averaging about $8 a bushel this quarter and the next, the highest levels in three years, farms will earn approximately $94.7 billion, according to analysts’ forecasts compiled by Bloomberg and an estimate from the USDA.
Other considerations for investors to consider is how this will impact shipping. Expectations are shipping lines won't benefit much from the increase in production because the U.S. is replacing lost supply from Russia and Ukraine.
Domestically it could help those companies shipping within borders, as it could offer some major boosts in that regard.
How quickly the griping from farmers has subsided since the worst of the recession when they were complaining about high input costs.
The U.S. will control 28 percent of global wheat exports in 2011, an increase from 18 percent in 2010, according to the U.S. Department of Agriculture. With prices averaging about $8 a bushel this quarter and the next, the highest levels in three years, farms will earn approximately $94.7 billion, according to analysts’ forecasts compiled by Bloomberg and an estimate from the USDA.
Other considerations for investors to consider is how this will impact shipping. Expectations are shipping lines won't benefit much from the increase in production because the U.S. is replacing lost supply from Russia and Ukraine.
Domestically it could help those companies shipping within borders, as it could offer some major boosts in that regard.
Wednesday, April 20, 2011
Caterpillar (CAT) (AGCO) (DE) (MON) Jump on Rising Wheat Prices
Shares of Caterpillar (NYSE:CAT) and AGCO (NYSE:AGCO) Deere (NYSE:DE) and Monsanto (NYSE:MON) are all trading up today on news wheat is helping farmers generate profits which should boost the bottom line of the Ag companies.
Wheat is now trading at about $8 a bushel, the highest level in three years. Poor weather conditions should help wheat to continue to rise in price over the next month or so.
Wheat exports from America are also estimated to rise by 18 percent over last year, according to a Bloomberg report.
Jefferies analyst Stephen Volkmann wrote, “Going into the winter, the US winter wheat crop condition was already well below last year, with only 47% in good/excellent condition and 17% in poor/very poor condition, compared to 63% good/excellent and 6% poor/very poor last year. With the spring thaw, this has now declined to only 36% in good/excellent condition, and 38% in poor or very poor condition. At the same time, most of the poor crops are concentrated in prime wheat producing states – Kansas, Oklahoma, Texas, and to a lesser extent, Nebraska – suggesting that the impact on yields could be larger.”
Higher crop prices provide more confidence and capital for farmers to spend on a variety of needed inputs.
Caterpillar was trading at $107.89, gaining $2.22, or 2.11 percent, as of 2:44 PM EDT. AGCO was at $53.17, up $1.35, or 2.61 percent. Deere was trading at $93.71, rising $1.33, or 2.11 percent. Monsanto was trading at $67.48, increasing $0.63, or 0.94 percent.
Wheat is now trading at about $8 a bushel, the highest level in three years. Poor weather conditions should help wheat to continue to rise in price over the next month or so.
Wheat exports from America are also estimated to rise by 18 percent over last year, according to a Bloomberg report.
Jefferies analyst Stephen Volkmann wrote, “Going into the winter, the US winter wheat crop condition was already well below last year, with only 47% in good/excellent condition and 17% in poor/very poor condition, compared to 63% good/excellent and 6% poor/very poor last year. With the spring thaw, this has now declined to only 36% in good/excellent condition, and 38% in poor or very poor condition. At the same time, most of the poor crops are concentrated in prime wheat producing states – Kansas, Oklahoma, Texas, and to a lesser extent, Nebraska – suggesting that the impact on yields could be larger.”
Higher crop prices provide more confidence and capital for farmers to spend on a variety of needed inputs.
Caterpillar was trading at $107.89, gaining $2.22, or 2.11 percent, as of 2:44 PM EDT. AGCO was at $53.17, up $1.35, or 2.61 percent. Deere was trading at $93.71, rising $1.33, or 2.11 percent. Monsanto was trading at $67.48, increasing $0.63, or 0.94 percent.
Saturday, March 12, 2011
Wheat Prices Plunge on Supply Boost
Wheat headed for the biggest weekly drop in more than two years in Chicago after the U.S. unexpectedly raised its global supply estimate. Rice and corn also declined on forecasts for bigger supplies.
Global wheat inventories will total 181.9 million metric tons at the end of the marketing year on May 31, up 2.3 percent from last month’s estimate, the U.S. Department of Agriculture said yesterday. Analysts surveyed by Bloomberg News had forecast stockpiles would decline to 177.56 million tons. Corn and rice inventory estimates also climbed.
“The USDA pointed to inventory stabilization, with small inventory builds for most crops,” Goldman Sachs Group Inc. analyst Damien Courvalin said in a report. “We believe that this stabilization will put a lid on crop prices in the short term. With the market focus shifting to the likely 2011-2012 supply response, we actually see downside risk to crop prices in the near term.”
Wheat for May delivery slid 14 cents, or 1.9 percent, to $7.265 a bushel at 10:06 a.m. London time on the Chicago Board of Trade. The grain is down 13 percent this week, on course for the biggest decline since December 2008.
Source
Global wheat inventories will total 181.9 million metric tons at the end of the marketing year on May 31, up 2.3 percent from last month’s estimate, the U.S. Department of Agriculture said yesterday. Analysts surveyed by Bloomberg News had forecast stockpiles would decline to 177.56 million tons. Corn and rice inventory estimates also climbed.
“The USDA pointed to inventory stabilization, with small inventory builds for most crops,” Goldman Sachs Group Inc. analyst Damien Courvalin said in a report. “We believe that this stabilization will put a lid on crop prices in the short term. With the market focus shifting to the likely 2011-2012 supply response, we actually see downside risk to crop prices in the near term.”
Wheat for May delivery slid 14 cents, or 1.9 percent, to $7.265 a bushel at 10:06 a.m. London time on the Chicago Board of Trade. The grain is down 13 percent this week, on course for the biggest decline since December 2008.
Source
Thursday, February 24, 2011
Speculators Flee Wheat on Middle Eastern Unrest
Wheat extended a collapse and corn and soybeans also fell as traders speculated that a jump in energy costs caused by protests across North Africa and the Middle East will curb growth and demand for grains.
Riots already ousted leaders in Egypt, the world’s biggest wheat importer, and in Tunisia, and opposition groups have seized control of eastern cities in Libya. While wheat traded in Chicago dropped 11 percent in the past four sessions, crude oil jumped 13 percent on the New York Mercantile Exchange.
Grain prices surged last month as North African and Middle East nations bought more shipments to damp a surge in domestic prices that helped spark the protests from Morocco to Bahrain. Speculators including hedge funds last week cut their bets on higher wheat prices by 20 percent, U.S. Commodity Futures Trading Commission data show.
“Investors continue to exit grain positions in favor of energy and financial markets due to anxiety over political unrest in the Middle East and North Africa,” Jim Gerlach, president of A/C Trading Inc., said by phone from Fowler, Indiana. “The markets are focused on the negative impact that higher energy prices may have on the global economy and food demand.”
Full Story
Riots already ousted leaders in Egypt, the world’s biggest wheat importer, and in Tunisia, and opposition groups have seized control of eastern cities in Libya. While wheat traded in Chicago dropped 11 percent in the past four sessions, crude oil jumped 13 percent on the New York Mercantile Exchange.
Grain prices surged last month as North African and Middle East nations bought more shipments to damp a surge in domestic prices that helped spark the protests from Morocco to Bahrain. Speculators including hedge funds last week cut their bets on higher wheat prices by 20 percent, U.S. Commodity Futures Trading Commission data show.
“Investors continue to exit grain positions in favor of energy and financial markets due to anxiety over political unrest in the Middle East and North Africa,” Jim Gerlach, president of A/C Trading Inc., said by phone from Fowler, Indiana. “The markets are focused on the negative impact that higher energy prices may have on the global economy and food demand.”
Full Story
Saturday, January 29, 2011
Wheat Prices Fall Most in Two Months
Wheat fell the most in two months as the cost of the commodity may slow demand for U.S. supplies. Corn prices also dropped.
Wheat has soared 70 percent in the past year as bad weather damaged crops in Canada, Australia and Russia. U.S. export sales fell 13 percent in the week ended January 20 from a week earlier, Department of Agriculture data revealed. Speculators have cut back on bets on rising prices in each of the past three weeks, U.S. government data reveal.
Wheat futures for March delivery declined 20.5 cents, or 2.4 percent, to $8.2575 a bushel at 1:15 p.m. on the Chicago Board of Trade, the biggest decline since Nov. 16. The wheat price jumped 0.2 percent this week.
Prices also dropped on concerns that riots in Egypt, the world’s biggest buyer, will slow down on purchases.
Corn futures for March delivery fell 6.75 cents, or 1 percent, to $6.445 a bushel in Chicago. The price declined 2 percent this week.
Soybeans for March delivery fell 1.5 cents, or 0.1 percent, to $13.98 a bushel. The most-active contract declined 1 percent this week.
Wheat has soared 70 percent in the past year as bad weather damaged crops in Canada, Australia and Russia. U.S. export sales fell 13 percent in the week ended January 20 from a week earlier, Department of Agriculture data revealed. Speculators have cut back on bets on rising prices in each of the past three weeks, U.S. government data reveal.
Wheat futures for March delivery declined 20.5 cents, or 2.4 percent, to $8.2575 a bushel at 1:15 p.m. on the Chicago Board of Trade, the biggest decline since Nov. 16. The wheat price jumped 0.2 percent this week.
Prices also dropped on concerns that riots in Egypt, the world’s biggest buyer, will slow down on purchases.
Corn futures for March delivery fell 6.75 cents, or 1 percent, to $6.445 a bushel in Chicago. The price declined 2 percent this week.
Soybeans for March delivery fell 1.5 cents, or 0.1 percent, to $13.98 a bushel. The most-active contract declined 1 percent this week.
Friday, July 23, 2010
Wheat Futures: Which Direction?
Wheat futures have been riding high over the last four weeks, but that seems about to end, even though weather conditions in Canada and Russia continue to cause problems for the grain.
The challenge for wheat, as it has been for years, is the increasing amount of acreage around the world being dedicated to growing the grain.
With that in mind, the inevitable bad weather in various parts of the world, while having a temporary impact on wheat futures' prices, overall level off and bring them back down to where they belong.
Until there is a move toward planting less wheat, which is unlikely any time soon, this will remain the way things are.
Heading into August, wheat futures will drop down to about $5 a bushel, or even lower.
The challenge for wheat, as it has been for years, is the increasing amount of acreage around the world being dedicated to growing the grain.
With that in mind, the inevitable bad weather in various parts of the world, while having a temporary impact on wheat futures' prices, overall level off and bring them back down to where they belong.
Until there is a move toward planting less wheat, which is unlikely any time soon, this will remain the way things are.
Heading into August, wheat futures will drop down to about $5 a bushel, or even lower.
Thursday, July 1, 2010
Wheat Prices Could Keep Declining, Says Commonwealth Bank of Australia
After the largest gain in over four months, wheat futures in Chicago fell again, and according to the Commonwealth Bank of Australia, wheat prices could continue falling.
“The global economic recovery is looking increasingly unstable,” Commonwealth Bank of Australia said in a note to clients today. “U.S. harvest pressure also remains a risk” and wheat prices could keep declining.
Wheat farmers in the U.S. planted about 13.907 million acres of spring wheat, an increase of 4.8 percent from 2009, according to the U.S. Department of Agriculture.
Including all wheat varieties, total bushels of wheat inventory as of June first stood at 973 million as of June 1. That's up from 657 million last year.
We've been wondering out loud at Wheat Wise for some time why farmers continue to do this. Why continue to plant wheat under these conditions? Why not change to crops with better potential returns and margins? How hard is that to understand?
Wheat farmers must understand that an enormous amount of wheat is being planted in countries that did very little wheat sowing in the past, and add to that the increased amount in the U.S. and there's not going to be a good price any time in the near future.
“The global economic recovery is looking increasingly unstable,” Commonwealth Bank of Australia said in a note to clients today. “U.S. harvest pressure also remains a risk” and wheat prices could keep declining.
Wheat farmers in the U.S. planted about 13.907 million acres of spring wheat, an increase of 4.8 percent from 2009, according to the U.S. Department of Agriculture.
Including all wheat varieties, total bushels of wheat inventory as of June first stood at 973 million as of June 1. That's up from 657 million last year.
We've been wondering out loud at Wheat Wise for some time why farmers continue to do this. Why continue to plant wheat under these conditions? Why not change to crops with better potential returns and margins? How hard is that to understand?
Wheat farmers must understand that an enormous amount of wheat is being planted in countries that did very little wheat sowing in the past, and add to that the increased amount in the U.S. and there's not going to be a good price any time in the near future.
Friday, June 11, 2010
USDA Confirms Too Much Wheat
The wheat ending stocks are projected to be at 991 million bushels, according to the latest USDA figures, down a little from May, but irrelevant because of the enormous supply.
Even with the news out of Canada that wheat production is lower because of less acreage planted than originally thought, it's not going to do much to move prices at all.
And there is so much wheat the wet weather keeping farmers from planting their fields won't do anything either.
I talked about this last year, and it continues to puzzle me why farmers don't move out of their wheat planting and into a more profitable crop.
Add to this the increasing number of wheat farmers and production around the world and there is little reason to pursue wheat at this time.
Even with the news out of Canada that wheat production is lower because of less acreage planted than originally thought, it's not going to do much to move prices at all.
And there is so much wheat the wet weather keeping farmers from planting their fields won't do anything either.
I talked about this last year, and it continues to puzzle me why farmers don't move out of their wheat planting and into a more profitable crop.
Add to this the increasing number of wheat farmers and production around the world and there is little reason to pursue wheat at this time.
Tuesday, June 8, 2010
Wheat Woes Continue, Plunge to Three-Year Low
Good weather has resulted in a strong wheat crop, and consequently wheat futures plunged to a 3-year low as harvest in the southern U.S. Great Plains States begins.
Precipitation was the major factor in the bumper yields, as there was four times as much rain in the last month than normal, according to National Weather Service data.
Wheat futures for July delivery fell 3.5 cents, 0.8 percent, to $4.3225 a bushel on the Chicago Board of Trade, after reaching $4.31 a bushel, the lowest price for a most-active contract since April 3, 2007.
With the growing number of wheat farmers around the world and bumper wheat crops, there continues to be little reason prices will increase going forward, and makes you wander why farmers continue to plant the grain, other than government subsidies.
Precipitation was the major factor in the bumper yields, as there was four times as much rain in the last month than normal, according to National Weather Service data.
Wheat futures for July delivery fell 3.5 cents, 0.8 percent, to $4.3225 a bushel on the Chicago Board of Trade, after reaching $4.31 a bushel, the lowest price for a most-active contract since April 3, 2007.
With the growing number of wheat farmers around the world and bumper wheat crops, there continues to be little reason prices will increase going forward, and makes you wander why farmers continue to plant the grain, other than government subsidies.
Saturday, April 10, 2010
Spring Wheat Planting Acreage Rises
Spring Wheat Acreage
In somewhat of a surprise, spring wheat acreage will be higher by about 5 percent, although estimates of wheat plantings for the year are that they'll be down by 9 percent, according to the Planting Intentions Report.
Total acreage to be planted includes hard red and white wheat, and will come in at 13.9 million acres.
Although the final numbers aren't in yet, not much is expected to change in any major way.
This is surprising in light of the continuing downward pressure on wheat prices. It seems farmers would wisen up and plant another crop they can actually make money on.
In somewhat of a surprise, spring wheat acreage will be higher by about 5 percent, although estimates of wheat plantings for the year are that they'll be down by 9 percent, according to the Planting Intentions Report.
Total acreage to be planted includes hard red and white wheat, and will come in at 13.9 million acres.
Although the final numbers aren't in yet, not much is expected to change in any major way.
This is surprising in light of the continuing downward pressure on wheat prices. It seems farmers would wisen up and plant another crop they can actually make money on.
Thursday, October 1, 2009
Wheat in Sixth Quarterly Drop
The sixth straight quarterly drop by wheat is the longest losing streak in a minimum of 50 years, as global supply far exceeds demand, continuing to put downward pressure on wheat prices.
According to USDA data, global wheat stockpiles have increased by 10 percent to reach 186.6 million tons during 2009-2010. Oveall production could reach as high as 663.7 tons, only behind last year's 682.3 million tons.
With many other countries focusing on increasing their own domestic wheat supplies, imports have plunged to 121.1 million tons from the 141.2 million tons at the same time last year.
As of mid-September, only 10.5 million metric tons of wheat, or 386 bushels was ordered by foreign buyers, a huge decrease of 36 percent from a year ago.
Wheat supply and prices - Wheat prices going down
According to USDA data, global wheat stockpiles have increased by 10 percent to reach 186.6 million tons during 2009-2010. Oveall production could reach as high as 663.7 tons, only behind last year's 682.3 million tons.
With many other countries focusing on increasing their own domestic wheat supplies, imports have plunged to 121.1 million tons from the 141.2 million tons at the same time last year.
As of mid-September, only 10.5 million metric tons of wheat, or 386 bushels was ordered by foreign buyers, a huge decrease of 36 percent from a year ago.
Wheat supply and prices - Wheat prices going down
Saturday, August 15, 2009
Wheat Futures Prices Near Term
Wheat Futures Prices
Wheat futures in the U.S. should continue to go nowhere for some time ahead unless something extraordinary happens where huge losses come about, which could probably only happen in Australia.
Production estimates for wheat continue to increase while demand decreases, cutting back significantly on wheat exports.
The USDA estimated 2009 U.S. wheat production was raised to 2.184 billion bushels from its July estimate of 2.112 billion, while the global wheat crop increased to 659.3 million tons from 656.5 million tons last month. The USDA's estimate for global ending stocks -- or what is left over after supply and demand are accounted for - also increased.
Wheat prices have plunged over the past year as global supplies have increased, and there is little sign of anything changing.
The continuing bearish information strengthened "the prevailing tone of the wheat market - one adrift in search of a persuasive fundamental storyline and dependant upon direction from other commodities," J.P. Morgan analyst Lewis Hagedorn said. "Absent a large decline in Australian production or demonstration of increasing global demand for protein wheat, prices appear likely to continue a gradual downward slide."
CBOT wheat will probably continue to experience new contract lows, although losses will be limited during the medium term by possible strength in CBOT corn and soybeans. Wheat prices should generally remain rangebound during the next couple of months.
Projections are it's possible September wheat could drop as low as $4.50 or December wheat to touch $4.75. The top end of the contracts' ranges should be about $5.25 for September, assuming a rally in beans and corn comes about.
A lot of negative things would have to happen across the world in order for any type of rally to happen, along with El Niño drying up Australian wheat fields, a continuing wheat disaster in Argentina, and an ongoing rain shortage in the Black Sea Region
But even with all of that happening, there's no surety, as the other places in the world have shored up their domestic wheat production, which is the real mitigating factor in the overall scheme of things.
At best there would be a mild recovery of wheat prices assuming all the above happens, but that doesn't guarantee the U.S. would be getting that business.
Wheat Futures Prices
Wheat futures in the U.S. should continue to go nowhere for some time ahead unless something extraordinary happens where huge losses come about, which could probably only happen in Australia.
Production estimates for wheat continue to increase while demand decreases, cutting back significantly on wheat exports.
The USDA estimated 2009 U.S. wheat production was raised to 2.184 billion bushels from its July estimate of 2.112 billion, while the global wheat crop increased to 659.3 million tons from 656.5 million tons last month. The USDA's estimate for global ending stocks -- or what is left over after supply and demand are accounted for - also increased.
Wheat prices have plunged over the past year as global supplies have increased, and there is little sign of anything changing.
The continuing bearish information strengthened "the prevailing tone of the wheat market - one adrift in search of a persuasive fundamental storyline and dependant upon direction from other commodities," J.P. Morgan analyst Lewis Hagedorn said. "Absent a large decline in Australian production or demonstration of increasing global demand for protein wheat, prices appear likely to continue a gradual downward slide."
CBOT wheat will probably continue to experience new contract lows, although losses will be limited during the medium term by possible strength in CBOT corn and soybeans. Wheat prices should generally remain rangebound during the next couple of months.
Projections are it's possible September wheat could drop as low as $4.50 or December wheat to touch $4.75. The top end of the contracts' ranges should be about $5.25 for September, assuming a rally in beans and corn comes about.
A lot of negative things would have to happen across the world in order for any type of rally to happen, along with El Niño drying up Australian wheat fields, a continuing wheat disaster in Argentina, and an ongoing rain shortage in the Black Sea Region
But even with all of that happening, there's no surety, as the other places in the world have shored up their domestic wheat production, which is the real mitigating factor in the overall scheme of things.
At best there would be a mild recovery of wheat prices assuming all the above happens, but that doesn't guarantee the U.S. would be getting that business.
Wheat Futures Prices
Monday, August 10, 2009
Wheat Exports in Slow Start
Exports of U.S. wheat promise to be down significantly for 2009-2010, according to the USDA, as projections are for about 925 million bushels of wheat to export during that time period, where the marketing year began on June 1.
Assuming this is accurate, which it seems it's close, that would be 90 million less bushels of wheat exported this year over last, and a huge 339 million less than the 2007-2008 year.
At this pace it'll be the third worst year of wheat exports in 25 years.
Wheat export inspections for the first 9.6 weeks show that they're at 130.7 million bushels; almost 100 million bushels under last year at this time. The weekly average wheat inspection has been at an anemic 13.7 million bushels.
This is even far below the USDA export projection of 925 million bushels, as the average needed to reach that is 18.7 million bushels for the rest of the year, which will be difficult to attain.
While some say this isn't a good comparison over the very quick rate of wheat exports last year, it still is far behind what would be needed to reach projections. As fo the end of July, the USDA said outstanding export sales of wheat stood at 148 million bushels, while last year it was at 276 million bushels.
The USDA’s weekly U.S. Export Sales report breaks down exports and export sales by where the wheat is headed and by class of wheat. Through July 30, export commitments compared to those of last year plunged by 60 percent for hard red winter wheat, 63 percent for soft red winter wheat, and 26 percent for hard red spring wheat. Export commitments were 17 percent larger for white wheat and 15 percent larger for durum wheat. Commitments for all classes of wheat were down by a huge 46 percent.
Among its largest wheat trading partners, commitments have dropped significantly; 27 percent to the Philippines, 45 percent to Japan, 48 percent to Mexico, and 87 percent to Egypt. Egypt buys only soft red winter wheat from the U.S.
Exports of wheat globally are down this year because a number of countries have significantly increased wheat production domestically, so diminishing the amount of wheat needed for its citizenry outside the countries.
Much of the recent low wheat prices has been attributed primarily to the decline in export demand for soft red winter wheat, which doesn't look to change this year.
As far as wheat inventories globally, they are expected to grow by 8 percent this year, which equals 512 million bushels. Of that, China will account for 80 percent of the wheat inventory increase.
Assuming this is accurate, which it seems it's close, that would be 90 million less bushels of wheat exported this year over last, and a huge 339 million less than the 2007-2008 year.
At this pace it'll be the third worst year of wheat exports in 25 years.
Wheat export inspections for the first 9.6 weeks show that they're at 130.7 million bushels; almost 100 million bushels under last year at this time. The weekly average wheat inspection has been at an anemic 13.7 million bushels.
This is even far below the USDA export projection of 925 million bushels, as the average needed to reach that is 18.7 million bushels for the rest of the year, which will be difficult to attain.
While some say this isn't a good comparison over the very quick rate of wheat exports last year, it still is far behind what would be needed to reach projections. As fo the end of July, the USDA said outstanding export sales of wheat stood at 148 million bushels, while last year it was at 276 million bushels.
The USDA’s weekly U.S. Export Sales report breaks down exports and export sales by where the wheat is headed and by class of wheat. Through July 30, export commitments compared to those of last year plunged by 60 percent for hard red winter wheat, 63 percent for soft red winter wheat, and 26 percent for hard red spring wheat. Export commitments were 17 percent larger for white wheat and 15 percent larger for durum wheat. Commitments for all classes of wheat were down by a huge 46 percent.
Among its largest wheat trading partners, commitments have dropped significantly; 27 percent to the Philippines, 45 percent to Japan, 48 percent to Mexico, and 87 percent to Egypt. Egypt buys only soft red winter wheat from the U.S.
Exports of wheat globally are down this year because a number of countries have significantly increased wheat production domestically, so diminishing the amount of wheat needed for its citizenry outside the countries.
Much of the recent low wheat prices has been attributed primarily to the decline in export demand for soft red winter wheat, which doesn't look to change this year.
As far as wheat inventories globally, they are expected to grow by 8 percent this year, which equals 512 million bushels. Of that, China will account for 80 percent of the wheat inventory increase.
Monday, August 3, 2009
Global Demand for Wheat Down
Wheat Market
Wheat futures continue their downward slide as they are down a whopping 33 percent from the same time last year, and the overall market looks to continue to be bearish, as international demand continues to slide.
“The wheat market is in a slumber,” Stuart Richardson, Australian commodity management spokesman for the Melbourne- based company, said today. “Flour mills around the world have generally entered the new season with greater stocks in their supply line than the year before.
“There is plenty of wheat available competing for limited demand, so the fundamental market picture is bearish,” Richardson added, which updated estimated wheat prices for Australian farmers. “Production risk is diminishing in the northern hemisphere, with the winter wheat harvests almost complete in the U.S. and well advanced in the European Union and Black Sea region.”
For the second month in a row wheat futures have fallen, and wheat speculators and hedge fund managers are increasing their short positions in the golden grain, believing they haven't yet reached their lows.
Wheat Market
Wheat futures continue their downward slide as they are down a whopping 33 percent from the same time last year, and the overall market looks to continue to be bearish, as international demand continues to slide.
“The wheat market is in a slumber,” Stuart Richardson, Australian commodity management spokesman for the Melbourne- based company, said today. “Flour mills around the world have generally entered the new season with greater stocks in their supply line than the year before.
“There is plenty of wheat available competing for limited demand, so the fundamental market picture is bearish,” Richardson added, which updated estimated wheat prices for Australian farmers. “Production risk is diminishing in the northern hemisphere, with the winter wheat harvests almost complete in the U.S. and well advanced in the European Union and Black Sea region.”
For the second month in a row wheat futures have fallen, and wheat speculators and hedge fund managers are increasing their short positions in the golden grain, believing they haven't yet reached their lows.
Wheat Market
Tuesday, July 21, 2009
CBOT Owner Resists Wheat Restrictions
Wheat Markets
The attempt by the government to regulate and interfere with the wheat market could be another disaster in the making, as the completely foolish, misguided and clueless Democrats continue their assault on free markets.
According to Charles Carey, vice chairman of CBOT owner CME Group Inc., government restrictions on trading "are more likely to be harmful to the functioning of our markets than helpful," and he's absolutely right.
The idea that we should have some type of perfection in place so no one ever gets hurt is outrageous, socialist and fascist to the core. Short term fluctations in wheat prices will never last, and that's the illusory problem the goofy Democrats think needs to be solved.
Unbelievably, federal regulators are "seriously considering" restrictions in the wheat futures market being urged by lawmakers concerned over speculation they say has artificially inflated prices, supposedly interfering risk management by farmers and grain processors.
After a wasted year and time, a faux investigation by the investigative panel of the Senate Homeland Security and Governmental Affairs Committee found that the disconnect between the wheat futures and cash markets can mean higher prices for consumers. They say this with a straight face when corn prices and lack of planting of wheat does more to jack up the prices because of other government interference through subsidies from taxpayers dollars.
A number of senators have called on the Commodity Futures Trading Commission to restrict the volume of index trading in the wheat futures market on the Chicago Board of Trade, a completely ridiculous idea.
Foolishly, CFTC Chairman Gary Gensler told the Senate subcommittee at a recent hearing that the agency "is seriously considering this recommendation ... (and) will continue to closely monitor the performance of the wheat futures contract."
Democrat Panel chairman Carl Levin, ignorantly said such a review "is badly needed." Several other members of the committee, representing farm states, voiced concern about the impact of market problems on wheat producers in those states.
Again, to me much of this is to hide the real culprit in wheat prices, federal subsidies of corn for the failing corn-based ethanol industry, which is pushing up prices because of less acreage used for wheat because of the artifical price increases created by the U.S. government.
But an official of the company that operates the Chicago Board of Trade, where wheat futures are traded, opposed such constraints and disputed the Senate probe's findings, as mentiond above from Charles Carey's accurate comments.
The idea of attempting to manipulate the market by the U.S. government and Democrats will fail, as the utopian idea of reducing risk is completely foolish and always fails, and the wheat and commodities markets overall will suffer.
Commodity indexes include futures contracts for delivery in different months. Commodity index traders sell financial instruments whose values rise and fall along with the value of the index on which they are located.
Commodity index traders acquire wheat futures to help offset their risk from selling the instruments to third parties. That pumps billions of dollars into the market and lifts demand and prices for wheat futures, the faulty results of the Senate investigation found.
Other related to the risk factors are also whining about the alleged discrepencies, as one person representing the American Bakers Association and the Sara Lee Corp said at the hearing, "Bakers cannot escape the impact. Today's volatility represents millions of dollars daily in undue financial risk."
What this disingenous bureaucrat doesn't say is this has always been the case, and the those that manage this risk factor are the ones who win. In the stimulous and spirit of bailing out company after company, those that can't compete are attempting to make it look like something unusual is happening, when in fact it has been the practice and way of doing business for a long time.
The one who knows about this the best is Charles Carey, vice chairman of CBOT owner CME Group Inc., and he concludes that the findings of the Senate report "are based on faulty economic analysis and a misunderstanding of basic market economics."
Just look at what the Democrats and Obama are doing to destroy America with its socialist and fascist policies, and you can easily understand how this group of politicians are among the most inexperienced and naive in American history; in both foreign and domestic policy, and they need to just shut up and let the free market work things out, which it always has done.
Wheat Markets
The attempt by the government to regulate and interfere with the wheat market could be another disaster in the making, as the completely foolish, misguided and clueless Democrats continue their assault on free markets.
According to Charles Carey, vice chairman of CBOT owner CME Group Inc., government restrictions on trading "are more likely to be harmful to the functioning of our markets than helpful," and he's absolutely right.
The idea that we should have some type of perfection in place so no one ever gets hurt is outrageous, socialist and fascist to the core. Short term fluctations in wheat prices will never last, and that's the illusory problem the goofy Democrats think needs to be solved.
Unbelievably, federal regulators are "seriously considering" restrictions in the wheat futures market being urged by lawmakers concerned over speculation they say has artificially inflated prices, supposedly interfering risk management by farmers and grain processors.
After a wasted year and time, a faux investigation by the investigative panel of the Senate Homeland Security and Governmental Affairs Committee found that the disconnect between the wheat futures and cash markets can mean higher prices for consumers. They say this with a straight face when corn prices and lack of planting of wheat does more to jack up the prices because of other government interference through subsidies from taxpayers dollars.
A number of senators have called on the Commodity Futures Trading Commission to restrict the volume of index trading in the wheat futures market on the Chicago Board of Trade, a completely ridiculous idea.
Foolishly, CFTC Chairman Gary Gensler told the Senate subcommittee at a recent hearing that the agency "is seriously considering this recommendation ... (and) will continue to closely monitor the performance of the wheat futures contract."
Democrat Panel chairman Carl Levin, ignorantly said such a review "is badly needed." Several other members of the committee, representing farm states, voiced concern about the impact of market problems on wheat producers in those states.
Again, to me much of this is to hide the real culprit in wheat prices, federal subsidies of corn for the failing corn-based ethanol industry, which is pushing up prices because of less acreage used for wheat because of the artifical price increases created by the U.S. government.
But an official of the company that operates the Chicago Board of Trade, where wheat futures are traded, opposed such constraints and disputed the Senate probe's findings, as mentiond above from Charles Carey's accurate comments.
The idea of attempting to manipulate the market by the U.S. government and Democrats will fail, as the utopian idea of reducing risk is completely foolish and always fails, and the wheat and commodities markets overall will suffer.
Commodity indexes include futures contracts for delivery in different months. Commodity index traders sell financial instruments whose values rise and fall along with the value of the index on which they are located.
Commodity index traders acquire wheat futures to help offset their risk from selling the instruments to third parties. That pumps billions of dollars into the market and lifts demand and prices for wheat futures, the faulty results of the Senate investigation found.
Other related to the risk factors are also whining about the alleged discrepencies, as one person representing the American Bakers Association and the Sara Lee Corp said at the hearing, "Bakers cannot escape the impact. Today's volatility represents millions of dollars daily in undue financial risk."
What this disingenous bureaucrat doesn't say is this has always been the case, and the those that manage this risk factor are the ones who win. In the stimulous and spirit of bailing out company after company, those that can't compete are attempting to make it look like something unusual is happening, when in fact it has been the practice and way of doing business for a long time.
The one who knows about this the best is Charles Carey, vice chairman of CBOT owner CME Group Inc., and he concludes that the findings of the Senate report "are based on faulty economic analysis and a misunderstanding of basic market economics."
Just look at what the Democrats and Obama are doing to destroy America with its socialist and fascist policies, and you can easily understand how this group of politicians are among the most inexperienced and naive in American history; in both foreign and domestic policy, and they need to just shut up and let the free market work things out, which it always has done.
Wheat Markets
Wednesday, July 8, 2009
India's Wheat Exports Limited by High Domestic Prices
India wheat exports down in fiscal year
In the midst of high local prices, projections are it will limit India's wheat and wheat product exports in the fiscal year ending March 2010, although the country has eased an earlier ban on exports this month to allow limited shipments.
On July 3, the federal government allowed three state-run firms - MMTC, STC and PEC - to export 300,000 tons each of wheat by March 31, 2010. In addition, private companies were allowed to export another 650,000 tons in wheat products, also by the same date.
But that is unlikely to lead to a surge exports.
"International prices are around $195 to $198/ton and Indian wheat costs around $232/ton," said Veena Sharma, secretary of Roller Flour Millers Federation (RFMF) of India.
She said exports are feasible only if international prices rise in the coming months.
"Unless there is a government subsidy of $30-$40/ton, (wheat exports are) not feasible," said Ajay Goyal, president of Maharashtra Roller Flour Millers Association (MRFMA).
However, the formal government order allowing the exports made it clear that "no subsidy will be given" to exporters.
India's federal government had imposed a ban on exports of wheat and wheat products in December 2007 to help curb inflation.
Since then, domestic wheat stocks have reached comfortable levels following two bumper crops and on carryover stocks from previous imports.
Even if some exports take place now, those could mainly be to neighboring countries, traders said.
"We may have to look to export to countries like Bangladesh, Nepal, Bhutan and Maldives to save on freight costs," said a state-run trading firm official, who did not want to be identified.
However, industry officials ruled out the possibility of wheat exports to Pakistan because there is no supply shortage there.
Meanwhile, state procurement of wheat has been on the rise following higher support prices.
Farmers sold more wheat to government agencies, rather than to private companies, as the state-fixed price of 10,800 rupees ($223)/ton was attractive, and relatively higher than even global prices, traders said.
Latest government data showed local wheat purchases by government agencies have already touched a record 25.06 million tons since purchases started in April, and more was trickling into state granaries.
In its annual budget announcement Monday, the government said it would step up subsidized sale of grains to poor consumers in the coming months.
With the chance of wheat exports looking slim, industry officials were more hopeful about exports of wheat products such as flour and semolina.
"Although there is not so much of demand for wheat products in the global market now, there could be some demand coming from the Middle East," said A N Gupta, chairman of Wheat Products Promotion Society of India.
He said demand for value-added wheat products from India is likely to be much more than the demand for the grain itself in global markets.
India wheat exports down in fiscal year
In the midst of high local prices, projections are it will limit India's wheat and wheat product exports in the fiscal year ending March 2010, although the country has eased an earlier ban on exports this month to allow limited shipments.
On July 3, the federal government allowed three state-run firms - MMTC, STC and PEC - to export 300,000 tons each of wheat by March 31, 2010. In addition, private companies were allowed to export another 650,000 tons in wheat products, also by the same date.
But that is unlikely to lead to a surge exports.
"International prices are around $195 to $198/ton and Indian wheat costs around $232/ton," said Veena Sharma, secretary of Roller Flour Millers Federation (RFMF) of India.
She said exports are feasible only if international prices rise in the coming months.
"Unless there is a government subsidy of $30-$40/ton, (wheat exports are) not feasible," said Ajay Goyal, president of Maharashtra Roller Flour Millers Association (MRFMA).
However, the formal government order allowing the exports made it clear that "no subsidy will be given" to exporters.
India's federal government had imposed a ban on exports of wheat and wheat products in December 2007 to help curb inflation.
Since then, domestic wheat stocks have reached comfortable levels following two bumper crops and on carryover stocks from previous imports.
Even if some exports take place now, those could mainly be to neighboring countries, traders said.
"We may have to look to export to countries like Bangladesh, Nepal, Bhutan and Maldives to save on freight costs," said a state-run trading firm official, who did not want to be identified.
However, industry officials ruled out the possibility of wheat exports to Pakistan because there is no supply shortage there.
Meanwhile, state procurement of wheat has been on the rise following higher support prices.
Farmers sold more wheat to government agencies, rather than to private companies, as the state-fixed price of 10,800 rupees ($223)/ton was attractive, and relatively higher than even global prices, traders said.
Latest government data showed local wheat purchases by government agencies have already touched a record 25.06 million tons since purchases started in April, and more was trickling into state granaries.
In its annual budget announcement Monday, the government said it would step up subsidized sale of grains to poor consumers in the coming months.
With the chance of wheat exports looking slim, industry officials were more hopeful about exports of wheat products such as flour and semolina.
"Although there is not so much of demand for wheat products in the global market now, there could be some demand coming from the Middle East," said A N Gupta, chairman of Wheat Products Promotion Society of India.
He said demand for value-added wheat products from India is likely to be much more than the demand for the grain itself in global markets.
India wheat exports down in fiscal year
Friday, June 5, 2009
Wheat | Durum Wheat Prices Rising Slower than Spring Wheat
Wheat Prices
Durum wheat hasn't followed the trend of its spring wheat counterpart, as it lages behind the higher prices spring wheat have brought so far this year.
Though some local cash durum prices have risen slightly they have not risen at the same level as spring wheat.
“Unfortunately durum hasn't enjoyed the same price increases as hard red spring wheat,” Olson said. “In fact, durum cash prices around the state are less than hard red spring wheat prices in some cases.”
Local cash bids for durum are anywhere from $6.75 to $7.25, which is just slightly higher than a couple weeks ago.
One of the major reasons spring wheat prices have appreciated so much recently is because planting is so far behind the usual pace. And although durum planting is also behind the normal pace, it is not as far behind as spring wheat.
In North Dakota, 69 percent of the durum crop has been planted compared to an average of 77 percent - just eight percentage points behind. Spring wheat in North Dakota, on the other hand, is 79 percent complete versus an average of 95 percent - a difference of 16 percent.
In one week, durum planting progress jumped by over 40 percent due to the good planting conditions the week of May 18-24.
In Montana, about 70 percent of the durum crop has been planted. That compares to an 84 percent average.
Olson pointed out that emergence for durum is also behind due to cooler than normal conditions this spring, but the recent warmer temperatures should help promote emergence and crop development.
The U.S. desert southwest durum crop is getting ripe and harvest is expected to begin soon.
“Right now about half the crop is mature,” Olson said. “There doesn't appear to be any major issues with that crop and we're expecting to see both good quality and good yields.”
To the north, Canadian producers are also experiencing a late planting season, but they have other concerns as well.
“In Canada there's actually some concerns that it's getting too dry in some of the major durum producing regions, so that obviously could impact planted acres and production,” Olson said.
In Europe, the only production concern is that wet weather and poor crop conditions have cut the estimate for durum production in italy from 147 million bushels to 127 million. North Africa has seen “near perfect growing conditions” so their production will be well above last year's levels, according to Olson.
U.S. durum exports lately haven't been overly supportive for prices either.
Wheat Prices
Durum wheat hasn't followed the trend of its spring wheat counterpart, as it lages behind the higher prices spring wheat have brought so far this year.
Though some local cash durum prices have risen slightly they have not risen at the same level as spring wheat.
“Unfortunately durum hasn't enjoyed the same price increases as hard red spring wheat,” Olson said. “In fact, durum cash prices around the state are less than hard red spring wheat prices in some cases.”
Local cash bids for durum are anywhere from $6.75 to $7.25, which is just slightly higher than a couple weeks ago.
One of the major reasons spring wheat prices have appreciated so much recently is because planting is so far behind the usual pace. And although durum planting is also behind the normal pace, it is not as far behind as spring wheat.
In North Dakota, 69 percent of the durum crop has been planted compared to an average of 77 percent - just eight percentage points behind. Spring wheat in North Dakota, on the other hand, is 79 percent complete versus an average of 95 percent - a difference of 16 percent.
In one week, durum planting progress jumped by over 40 percent due to the good planting conditions the week of May 18-24.
In Montana, about 70 percent of the durum crop has been planted. That compares to an 84 percent average.
Olson pointed out that emergence for durum is also behind due to cooler than normal conditions this spring, but the recent warmer temperatures should help promote emergence and crop development.
The U.S. desert southwest durum crop is getting ripe and harvest is expected to begin soon.
“Right now about half the crop is mature,” Olson said. “There doesn't appear to be any major issues with that crop and we're expecting to see both good quality and good yields.”
To the north, Canadian producers are also experiencing a late planting season, but they have other concerns as well.
“In Canada there's actually some concerns that it's getting too dry in some of the major durum producing regions, so that obviously could impact planted acres and production,” Olson said.
In Europe, the only production concern is that wet weather and poor crop conditions have cut the estimate for durum production in italy from 147 million bushels to 127 million. North Africa has seen “near perfect growing conditions” so their production will be well above last year's levels, according to Olson.
U.S. durum exports lately haven't been overly supportive for prices either.
Wheat Prices
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