All three wheat futures fell to a seven month low this week on improved weather conditions in the U.S. Plains. While not eliminating drought concerns, rain and snow provided a significant boost to soil moisture across much of the wheat belt. A forecast for additional precipitation next week in the Plains and Midwest added pressure. Strong export sales due to lower futures prices led to positive gains on Friday. The KCBT March wheat contract fell 25 cents to close the week at $7.75/bu. MGEX dropped 17 cents to $8.19/bu and CBOT closed at $7.42/bu, a 14 cent decline. CBOT March corn fell 10 cents to $6.99/bu and CBOT March soybeans lost 28 cents to $14.25/bu.
HRS basis was firmer this week following a large sale to China. In addition, farmer selling has slowed significantly due to lower futures prices.
ABARES increased its estimate for 2012/13 Australian domestic wheat production to 22.1 MMT as the crop mostly escaped damage from a heat wave and floods during the summer.
USDA reported weekly commercial wheat sales of 706,300 MT, up noticeably from the previous week and up 54 percent from the prior 4-week average. Sales exceeded trade estimates of 275,000 to 600,000 MT.
The Baltic Panamax Index gained 15 percent this week to 832 on Friday, its highest level this calendar year. In what was expected to be a quiet week, a flurry of enquiries for U.S. Gulf and Baltic coal cargos supported the market. A spur of activity from the east coast of South American also boosted the index. Maritime Research's Grain Freight Index decreased this week from 495.0 to 490.5.
The US Dollar Index increased slightly this week from 80.32 to 80.58.
