Latest news with #winterwheat
Reuters
19 hours ago
- Business
- Reuters
US wheat gets a glow-up: Multiyear highs for crop health, export sales: Braun
NAPERVILLE, Illinois, June 9 (Reuters) - Second-worst ever. That's how health conditions for the 2025 U.S. winter wheat crop were described last autumn. But winter wheat ratings now sit at a six-year high for early June, just as the harvest is kicking off. This is exactly what U.S. exporters need to continue – and potentially expand – their impressive sales into next year. As of Sunday, the U.S. Department of Agriculture rated 54% of the U.S. winter wheat crop in good or excellent (GE) condition, above trade expectations and up from 50% two weeks earlier. That is up significantly from 38% GE in late October, which was the crop's second-worst start in the 39-year dataset. The 16-percentage-point improvement since then is the period's largest. U.S. winter wheat at 54% GE is the date's best rating since 64% in 2019. The crop was 62% GE at this point in 2016, which still holds the record U.S. winter wheat yield. Final yields were about 13% and 7% above the long-term trend in 2016 and 2019, respectively. For comparison, winter wheat was 47% GE one year ago and final yields were close to trend. Analysts expect USDA on Thursday to make a marginal increase to its 2025-26 U.S. winter wheat harvest forecast, but the trade has already been wrong on this crop. A month ago, USDA's crop peg was at the very top of market guesses. USDA a month ago pegged 2025-26 U.S. winter wheat yield at a nine-year high of 53.7 bushels per acre, which would be roughly 3% above trend. Not everything is going perfectly. The U.S. winter wheat harvest was 4% completed as of Sunday, a weekly advancement of just 1 percentage point. The trade was looking for 8%. In the No. 3 winter wheat state of Oklahoma, only 5% of the crop has been harvested compared with 44% a year ago and a five-year average of 23%. Over the past couple of weeks, top hard red winter wheat (HRW) states like Kansas and Oklahoma have observed more than double their normal rainfall totals. Some HRW wheat areas may continue experiencing heavier rains over the next several days, mainly in the southern portion. Top grower Kansas should remain on the drier side in the next week or so, favoring harvest pace there. If excessive rains were to continue, it could be a problem. Not only do they delay harvest, but they could reduce grain quality, clipping both test weights and starch content and ultimately, the value. Foreign buyers are counting on that wheat. As of May 29, U.S. wheat export sales for the 2025-26 marketing year that began on June 1 sat at a 12-year high for the date following a surge in bookings last month. Some 39% of those bookings were for the HRW variety, the date's largest portion in five years and up from 24% a year ago. By volume, U.S. HRW export sales for 2025-26 are at a 17-year high. New-crop U.S. hard red spring wheat also rang in 2025-26 with total sales among the best in decades. U.S. spring wheat health is trending positively, too. Some 53% of that crop was rated GE as of Sunday, up from the initial 45% two weeks earlier. Ironically, as with winter wheat, that was spring wheat's second-worst initial health rating on record. The 53% is still below average for the date, but the big improvement is promising. U.S. spring wheat producers may be able to partly offset their 55-year low in plantings should weather continue its favorable trajectory. Karen Braun is a market analyst for Reuters. Views expressed above are her own. Enjoying this column? Check out Reuters Open Interest (ROI), opens new tab, your essential new source for global financial commentary. ROI delivers thought-provoking, data-driven analysis of everything from swap rates to soybeans. Markets are moving faster than ever. ROI, opens new tab can help you keep up. Follow ROI on LinkedIn, opens new tab and X., opens new tab
Globe and Mail
24-05-2025
- Business
- Globe and Mail
Weaker US$, weather could spur grain bulls after holiday
Happy Memorial Day weekend market watchers! Let us honor those who have and continue to serve our country and remember those who have given the ultimate sacrifice to keep our nation free. Take this opportunity to go visit those family and friends who are now only with us in spirit. This weekend marks the official unofficial start to the summer season! For many of us, it is forecast to be a rainy five days ahead. That is good news for summer crops already planted or about to be, but less ideal for ripening winter wheat near maturity. There is still quite a bit of green out there in wheat and so overcast conditions may still help quality, but for earlier varieties and areas further south, additional precip at this stage could begin to impact quality, particularly test weight. However, I believe we are okay in Oklahoma and north, but there is an above normal probability that the end of May through early June is going to be wetter. US winter wheat conditions actually declined by two percentage points in the Good-to-Excellent ratings this past week led by a ten percent decline in Texas and Colorado, four percent in Montana and two percent in Nebraska. Oklahoma conditions improved by three percent, Kansas by one percent and South Dakota by four percent, but from a very low base at only 23 percent G/E versus last year's 74 percent. Suffice it to say there is a lot of variability around the country, but Oklahoma and Kansas yields are likely to be a decent crop overall, barring any widespread weather issues during this season of severity. Last week's USDA reports that included the 2025/26 wheat production estimates grew the US winter wheat crop to 1.364 billion bushels while versus last year's 1.349 billion bushels while traders were expecting a cut to 1.325 billion bushels. Hard red winter wheat, traded as the KC wheat futures contract, increased to 784 million bushels from 770 million bushels last year while traders were again expecting a decline to 748 million bushels. This increased new crop ending stocks for wheat to 923 million bushels from 857 million bushels expected and 841 million bushels last year. Kansas was a major contributor to these increases with the recent Wheat Quality Council tour pegging this year's state average at 53.0 bushels per acre versus USDA's 50.0 bpa, last year's 46.5 bpa and the five-year average yield of 44.3 bpa. This is a tall order to achieve, but responsible for the relentless selling pressure in wheat that led to managed money setting three weeks of consecutive new record net shorts in KC wheat futures. For now, I believe the lows are in after July KC futures touched a low of $5.00 ¼ on May 13 th. July KC finished the trading week Friday with an inside day on the chart, closing at $5.38 ¾. July Chicago stalled at the 50-day moving average and closed the week at $5.43 ½ despite being a lower protein wheat contract versus the KC. While I could see these contracts softening to their respective 9-day moving averages short-term, I believe we could see more strength return to the KC complex, in particular, especially if the US dollar continues to weaken as it looks set to do. The heat and dryness in China's key wheat province continue to build. Corn and soybean futures rebounded firmly this week with the moving averages beginning to point up as weather premiums return. US corn planting is now 78 percent complete, one percent behind trader expectations, but well ahead of average. US soybean seeding was called 66 percent complete, one percent ahead of expectations and a whole 13 percent ahead of average. The USDA's recent supply side reports assumed trendline yields with corn at 181.0 bpa and soybeans at a new record yield of 52.5 bpa. This plus acreage expectations brought US corn production to 15.820 billion bushels, ahead of average trade guesses as well as the February Outlook Forum. US soybean production was largely in line with expectations, but below both the February Outlook Forum as well as last year. US ending stocks for the coming marketing year were, in fact, lower than expectations for both corn and soybeans. The USDA held soybean yields steady for Brazil and Argentina. World ending stocks for corn and soybeans came in lower than expectations with corn being much lower than both expectations and last year levels. Wheat ending stocks were higher, but in line with last year. With the Trump Administration keen to cut inflation in order to reduce interest rates, I'm expecting much of this to come from lower commodity prices, particularly energy. However, agriculture commodities now trade at their energy equivalents with the sheer volume used in biofuels. Therefore, lower energy could mean lower agriculture commodities with hopes that the Big Beautiful Bill and Farm Bill, with higher reference prices, will help fill the gap. The lower-than-expected renewable energy targets were less than desirable for soybeans and hopefully we will gain more clarity on 45z soon. Recent inflation reports show progress continues towards the Federal Reserve's 2.0 percent objective, but tariff policies cloud the view. We will dive into the policy side deeper once there is signed legislation. While tariff disputes with China have recently cooled, Trump announced a bombshell 50 percent tariff escalation on the EU before the long, Memorial Day weekend. Markets will be closed on Monday with grains re-opening on Monday at 7 PM CDT to start the Tuesday session. The livestock markets will resume trading on Tuesday at 8:30 AM CDT. After the recent $12.50 per cwt selloff in feeder futures that came in just two trading sessions followed by choppy trade, cash trade of fed cattle came back stronger yet with futures catching up with futures discounts still trading below cash. May feeders expired Thursday with August now the front-month. Feeder and fed cattle futures contracts are above the 9- and 20-day moving averages and look set to resume the bullish trend after the Thursday break higher. USDA's monthly Cattle-on-Feed report for May was released Friday at 2 PM CDT. May 1 st on-feed numbers came in as expected at 98.5 percent of last year while April placements were higher than expected at 97.4 percent versus 96.8 percent. April marketings also came in higher than expected at 97.5 percent versus 96.7 percent. While these reports provide a perspective, cash prices are hard to ignore. Fed cattle trade summary for the week topped out at $220 in Texas and Kansas and $231 in Nebraska, although we didn't confirm any head traded at that level in the north. Regardless, June fat futures traded to a high of $216 on Friday, $4 below the cash price. There are gaps higher on the feeder contracts with the gap filled on August feeders at $301.325. Unless we hear of other headwinds, cattle markets look set to move higher next week even once the gap is filled. These are fantastic price levels, but we could trade above this $3.00 mark for a bit longer, but don't lose perspective of these price levels. Feeders are just shy of the record net long. Watch for a new record net long to gauge a potential turning point, but the bulls seem to be back in charge for now. Sidwell Strategies is the one-stop shop to protect cattle with futures, puts, LRP or a combination of all, which is probably the best strategy overall. If you're ready to trade commodity markets, give me a call at (580) 232-2272 or stop by my office to get your account set up and discuss risk management and marketing solutions to pursue your objectives. Self-trading accounts are also available. It is never too late to start and there is no operation too small to get a risk management and marketing plan in place. Wishing everyone a successful trading week! Let us know if you'd like to join our daily market price and commentary text messages to stay informed! Brady Sidwell is a Series 3 Licensed Commodity Futures Broker and Principal of Sidwell Strategies. He can be reached at (580) 232-2272 or at brady@ Futures and Options trading involves the risk of loss and may not be suitable for all investors. Review full disclaimer at
