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US Wheat Price Report
  • All three futures markets fell this week thanks to some precipitation and a forecast for more in the drought stricken U.S. Plains. Weak export demand and a strong U.S. dollar also added pressure. Markets jumped following USDA’s WASDE release on Friday but gave back the gains in the afternoon due to a lack of surprises in the data. The KCBT March contract saw the largest loss of the three wheat contracts, falling 22 cents to $8.00/bu. MGEX lost 16 cents to $8.36/bu and CBOT closed down 9 cents at $7.56/bu. CBOT March corn fell 27 cents to $7.09 and CBOT March soybeans dropped 22 cents to $14.53/bu.
  • HRW basis in the Gulf was firmer this week in response to an announcement by Brazil’s trade authority Camex to exempt 1.0 MMT of wheat from its 10 percent import tariff. Between April and July, the country will allow tariff free imports from the U.S. and Canada due to a crop shortage in Brazil’s Mercosur partner Argentina. The exemption could be increased to 2.0 MMT, if necessary.
  • In its monthly WASDE update released on Friday, USDA lowered US ending stocks from 19.5 MMT to 18.8 MMT due to increased feed use. The move provided a boost to futures markets immediately after the report’s release because it was a larger reduction than analysts had expected. However, the gain dissipated in the second half of the trading day.
  • USDA reported weekly commercial wheat sales of 300,800 MT, just within trade estimates of 300,000 to 500,000 MT. Weak export demand pressured futures markets on Thursday.
  • The Baltic Panamax Index gained 9 percent this week to 723 on Friday. There was a rush of fixing activity ahead of the Chinese New Year and an increase in activity from the South American harvest. Maritime Research's Grain Freight Index decreased this week from 496.5 to 495.0.
  • The US Dollar Index increased this week from 79.14 to 80.32.

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