Wheat Market Recap Report for 1/26/2006 March Wheat finished up 2 1/2 at 344 1/2, 1 off the high and 4 up from the low. May Wheat closed up 3 at 355 3/4. This was 4 1/4 up from the low and 3/4 off the high.
1/26/2006 March wheat closed at its highest level in over three weeks today, buoyed by crop concerns and fund interest. Weekly US export sales for wheat came in at 429,100 metric tonnes, which was within the range of trade expectations between 300,000 and 500,000. Cumulative sales have already reached 78.1% of the USDA forecast for the entire marketing year as compared to 73.2% on average over the last five years. Sales of 314,200 metric tonnes per week are needed to reach the USDA estimate. The dryness in the southern plains continues to provide underlying support to the market, and the bitter cold weather in Russia and the Ukraine has provided underlying support as well. Winter cold weather is expected to have caused damage of 10-30% of the crops as compared with 5-10% in a normal year. The International Grain Council indicated this morning that world wheat production for the 2006/2007 season could drop to just 595 million tonnes as compared with 614.8 million tonnes for the current year. World consumption is pegged at 618 million tonnes for the 2005/2006 season as compared with 613 million tonnes last year. The market does not seem too concerned with the possibility of world ending stocks drawing down 20-25 million tonnes for the 2006/2007 season. If so, world ending stocks would come down to near 119.7 to 124.7. At 119.7 million tonnes, world ending stocks would be the lowest since 1981 and the stocks/usage ratio would be the lowest since at least 1960.
March Oats closed down 6 1/2 at 189 1/4. This was 1/4 up from the low and 7 3/4 off the high.
