March was another tough month for spring wheat prices. Competition across the global wheat complex and changes in buyer behavior are weighing on trader sentiment. So too was the surprising uptick in spring acreage numbers projected by the USDA this week.
This week, the USDA projected that spring wheat acres would come in at 32.71 million acres. That number was 1.62 million acres higher than 2017. This number stunned traders. Regardless of drought matters in the Dakotas, planting will proceed as scheduled as farmers look for a rebound in the sector.
Here’s a breakdown of the action on the contracts that we’re watching this month:
- May 2018: -7.0% or -43.3¢ to $5.785 USD / bushel
- July 2018: -7.0% or -44.3¢ to $5.865 USD / bushel
- Dec 2018: -5.9% or -38.0¢ to $6.070 USD / bushel
- Mar 2019: -4.9% or -31.8¢ to $6.185 USD / bushel
And this quarter:
- May 2018: -7.1% or -44.0¢ USD / bushel
- July 2018: -6.4% or -39.8¢ USD / bushel
- Dec 2018: -4.1% or -26.0¢ USD / bushel
- Mar 2019: -3.1% or -19.5¢ USD / bushel
Drought conditions across the United States are contracting, and traders are growing more cautious about changing conditions in the international wheat market, and whose got the competitive edge. This month, we explored a few of these key factors for our readers.
Specifically, we looked at:
- Acreage in Australia and their competitive exports,
- Lots of low-quality wheat exports from Russia,
- Declining imports from Saudi Arabia; and
- The costly effects of Egypt’s import requirements.
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 spring wheat for the rest of 2017/18 old crop supply, as well as a significant portion of your 2018/19 supply.