April 2018 Durum Wheat Prices Recap

Durum wheat prices seemed to act in slow motion this month as new significant demand or supply news created market-moving activity. Weakness of durum prices in Europe and North America was a common theme of the GrainCents Durum Weekly Digest.

As we entered the month of April, the market was still digesting the USDA’s Prospective Plantings report, which showed that American farmers will plant 2 million acres of durum in 2018/19. This is down 13% year-over-year but up 6% from the five-year average of 1.89 million acres though.

For the remainder of the month, the durum market lacked fresh news to propel durum prices higher. In a similar vein, we reported durum acreage cuts in Europe as we did back in March.

The end of the month culminated with some bearish news from StatsCan. While durum acreage cuts are expected in more than a few durum-producing countries, StatsCan said that Canadian farmers will plant 5.78 million acres of durum in 2018/19. This is up 11% year-over-year and above pre-report trade expectations. While a bit bearish for durum prices potential, it’s nothing like the 6 million acres that were suggested by a few durum buyers.

Moving forward, we’ll be watching durum planting progress in the US and Canada, crop conditions in Europe and North America, and, obviously, weather. The latter is the most significant as there is certainly some dryness that remains in the US Northern Plains and Western Canada.

Further, you don’t get good quality durum without some good weather. Conversely, you don’t get volatile quality without variable weather. And since we know that durum prices are very correlated to durum quality, and weather makes the quality, we must watch the weather.

Here are a few other factors that we looked at this month that impacted durum prices.

 

Be sure to sign up for your free 3-week trial at GrainCents as this month could be the most impactful for how and when you price your durum wheat for the rest of 2017/18 old crop, as well as a significant portion of your 2018/19 new crop production.

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About the Author
Adrian Uzea

Hailing from a farm in Romania’s breadbasket, Adrian’s keen interest in agriculture inspired him to obtain a Master's degree in Ag Economics from the University of Saskatchewan. Adrian provides deep, original insight for Canadian farmers of grains, oilseeds, and other specialty crops to help improve their bottom line. He was previously a Market Analyst with a provider of grain marketing services like DePutter Publishing.

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