US Plains hard red winter wheat basis bids were steady on Tuesday amid sluggish country movement and continued chatter about last weekend's freeze event. Speculation over the extent of any freeze damage on new-crop HRW wheat was tempered, however, with many country sources saying it will be weeks if not longer before damage determinations can be made.
Moreover, surviving tillers could still make a good crop if weather conditions are favourable, some said. "I don't know whether or not people remember 1997 and the freeze then. That freeze was as bad as this but it turned out to be about the best crop we raised in Kansas," said one wheat dealer. "Some people think it's a total disaster but a lot of us are not going to jump to conclusions."
Some were estimating the damage could range from as little as 50 million bushels to as much as 100 million. A weekly crop report out of Kansas issued Monday said that early indications were that about 16 percent of the new crop suffered severe damage, 15 percent was moderately damaged and 15 percent was lightly damaged, with 54 percent undamaged.
The USDA said that 64 percent of the winter wheat crop was in good to excellent condition, down from 71 percent in those categories a week earlier. The freeze damage talk comes after frigid temperatures blanketed the Plains winter wheat belt over the weekend.
The wheat futures market rallied Monday, with nearby Kansas City Board of Trade May wheat hitting the 30-cent limit up, but prices ultimately settled Monday 1-1/4 cents lower to 6-3/4 cents higher, with the May wheat contract down 1-1/4 cents at $4.68 per bushel and new-crop July up 6-3/4 at $4.73-3/4.
Wheat futures were called mixed on Tuesday with added support from a smaller-than-expected stocks number for wheat from the April USDA supply/demand report. USDA pegged 2006/07 US wheat ending stocks at 422 million bushels, below analysts estimates for 448 million, and below the USDA March forecast for 472 million.
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