US Wheat Export Sales Improve as Prices Fall

(Agrimoney) –  Well there’s something you don’t see every day – some not bad US wheat export data.

Not that the export sales of 353,800 tonnes that the US Department of Agriculture reported for the week to last Thursday, and for delivery in 2017-18, represent a bumper haul.

In the same week last year, for instance, the equivalent figure was 464,100 tonnes.

But it did come within the upper end of market expectations of a figure of 200,000-400,000 tonnes, and represent a 33% jump week on week.

Price appeal?

The improvement looks an indication of the power of lower prices in encouraging demand from importers (with Japan, Nigeria and Indonesia the top buyers in the latest period).

Chicago soft red winter wheat futures for May dropped by 4.8% over the week, and those in Kansas City hard red winter wheat by 8.3%.

That said, it was not these types of wheat which were the best performers, although export sales of hard red winter wheat, at 113,862 tonnes, did hit a six-week high.

White wheat (of which Indonesia and Japan, besides the Philippines and South Korea are large buyers) proved particularly popular, with export sales of 140,578 tonnes, the fifth best week of 2017-18 (which started in June in the US).

Corn in demand

The corn export sales figure, at 1.35m tonnes, was respectable too, coming in at the centre of the range of 1.20m-1.50m tonnes, although representing a decline of some 117,000 tonnes week on week.

On the plus side, sales for 2018-19 reached a further 287,037 tonnes on top, an unusually large figure for late March, more than five months before that marketing year starts.

The data were termed “good” by Terry Reilly at Futures International.

‘Very poor’

However, “export sales were very poor for soybeans,” Mr Reilly added, with the figure of 317,500 tonnes down 58% week on week, and coming in well below the 600,000-900,000 tonnes expected by investors.

The figure represented the third worst weekly performance of 2017-18 for the oilseed, and comes at a sensitive time, with focus on trade tensions between the US and China, which is by far the world’s biggest soybean importer.

China did not feature among the top buyers for 2017-18 in the latest week – although it did purchase one cargo of new crop and, at 139,600 tonnes, represent the top destination for actual exports in the latest week, which totalled a more respectable 782,900 tonnes.

Will shipments hold up as more of the crop hits port in rival Brazil, where growers are amid harvest?