Black Sea harvest data continues to suggest that Russia’s crop may still be understated by 1-2 MMTs, though Russia’s exportable capacity will go unchanged. We also mention that hi-pro milling wheat in Russia has fallen only slightly and comparable Gulf HRW maintains a slight discount to Russia – as well as all other origins. The world market has been inundated with this year’s N Hemisphere winter wheat harvest, but US wheat is viewed as cheap at current prices – which are only modestly above this week a year ago.
Breaking news is largely absent. US spring wheat ratings were pegged at 33% GD/EX, vs. 32% last week, but harvest is now 40% complete and what’s done is done. NASS’s production forecast is still overstated some 20-30 Mil Bu, which is entirely a function of abandonment.
Another 7-10 days of seasonal weakness is noted, but thereafter even a normal post-harvest recovery warrants patience with respect to extending sales. We remain concerned about production in Australia & Canada, and thus Canada’s ability to ship more wheat to the US.
