There were no major purchases of wheat for world demand over the weekend, however Kazakhstan announced on Monday that it plans to impose export tariffs on its grain beginning in March. There is no threatening weather for US winter wheat forecasted at this time. Allendale's research suggests a forward declining export sales trend has been the historical norm with a notable drop of exports by April. Signals of old crop economic rationing is apparent.
Canadian Wheat Board estimates 2008 wheat production at 25.163 million tonnes. This compares to last year's harvest of 20.050 million tonnes and 2006/07's 25.262 million tonnes. The CWB estimates 2008/09 wheat exports at 19.5 million tonnes versus its 2007/08's estimate of 15.2 million tonnes and compares to USDA's 2006/07 estimate of 19.6 million tonnes.
Texas Winter Wheat conditions according to the Texas Statistics Service shows that the weekly wheat condition report released on Monday that they estimate the good to excellent conditions at 10% versus 9% a week earlier and compares to one year ago levels of 46% good to excellent.
On Monday the July CBOT and MGEX wheat futures made a new life of contract high, while the KCBT got within 15-cents of achieving its old high. Technically the trend is up. Longer term, fundamentals remain supportive to new crop futures as US winter wheat conditions went into dormancy experiencing its third weakest good to excellent conditions and odds suggest the conditions may not show a turn around in quality ratings. Tight starch stocks for wheat, corn and rice are of investment interest to the speculator. Soft white wheat cash bids mostly in the mid 12-dollar area do not offer carry from March through May. Cash once a leader for SWW has now taken a back seat to the MGEX futures.
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