Food Business News - August 28, 2012 - 59

Ingredient Markets
Market commentary for one-week period ended August 24, 2012

Cash Wheat
HARD WINTER. Premiums on hard red winter wheat in Kansas City surged 10@22c a bu higher last week. Wheat offers were mostly light from day to day, forcing mills seeking to keep pipelines optimally filled and resellers who were short supply to meet their commitments to the mills to hike bids in hope of securing some of what little wheat was offered. Mills complained of some delayed shipments. Some mills bought wheat for September delivery, but activity in the market for toarrive wheat for beyond September was mostly lacking with bids and offers up to 20c apart. Wheat movement has slowed during the past couple of weeks. Producers across the Southwest were harvesting or preparing to harvest their fall crops, and wheat sales for most was not their primary consideration. With wheat prices strong and wheat futures carrying charges wide, producers, who earlier sold about 60% of the 2012 crop, were content to store the remainder for a while. The winter wheat harvest in Montana was 92% completed as of Aug. 19, compared with 74% on the same date last year and 73% as the 2007-11 average for the date, the U.S. Department of Agriculture said in its weekly Crop Progress report. The fall crop harvest expanded across the Southwest. The U.S.D.A. indicated the Kansas corn harvest was 17% completed by Aug. 19 compared with 1% as the recent five-year average for the date. The Nebraska harvest was 1% completed compared with zero as the average. The corn harvest was 34% completed in Oklahoma (6% as the average) and 51% in Texas (45%). With the drought reducing fall crop harvest prospects, producers felt little pressure to sell wheat to clear bins. A wetter weather pattern was forecast,

but the grip of the drought remained strong. Moisture was badly needed to recharge soil moisture ahead of fall planting of the 2012 hard red winter wheat crop. The U.S.D.A. indicated topsoil rated short to very short in moisture on Aug. 19 was 97% in Kansas, 97% in Oklahoma, 97% in Nebraska and 93% in Colorado. Subsoil rated short to very short in moisture was 97% in Kansas, 98% in Oklahoma, 96% in Nebraska and 94% in Colorado. HARD SPRING. Premiums on hard red spring wheat quoted as delivered Chicago/ beyond values in relation to the Minneapolis September wheat future dropped 5@25c a bu last week. Wheat offers exceeded demand as the spring wheat harvest raced to a conclusion. The spring wheat harvest was 79% completed as of Aug. 19 in the six major states, far ahead of 25% a year earlier and 40% as the 2007-11 average for the date, the U.S.D.A. said. The harvest was completed in South Dakota (81% as the average for the date), 99% in Minnesota (49%), 83% in North Dakota (34%), 65% in Montana (30%), 49% in Washington (46%) and 47% in Idaho (26%). The North Dakota Wheat Commission in its weekly crop progress report indicated the harvest should be nearly completed by the end of August. The commission noted producers continued to report strong yields and pointed to North Dakota State University quality data confirming a sound crop with an average grade of No. 1 dark northern spring. Statistics Canada forecast Canadian

spring wheat production in 2012 at 19,058,000 tonnes, up 6% from 18,031,000 tonnes in 2011 and compared with 17,485,000 tonnes in 2010. SOFT RED. Mill bids on soft red winter wheat registered mixed changes last week, but with the fall harvest expanding, the cash soft red winter wheat market was expected to strengthen. Kansas City bids on No. 1 soft red bids were withdrawn following a spike in St. Louis mill bids. Gulf bids on soft red for August were 50c over Chicago September, up 10c. St. Louis nearby mill bids were 40c over Chicago September, up 35c. Chicago mill bids were 20c over Chicago September, unchanged. Mill bids in Toledo for August-September were at 10c under Chicago September, down 10c; November-December, 15c over December; January-February, 25c over March. Elevator bids were 12c under Chicago September; new crop, Chicago July price. Cincinnati nearby mill bids were at 10c under Chicago September, up 5c. Elevator bids were 10c under Chicago September. Michigan white wheat mill bids for nearby ranged widely from 15c under Chicago September to 50c over. The corn harvest expanded across key soft red winter wheat states. The harvest was 18% completed in Missouri (1% as the recent five-year average for the date), 3% in Illinois (zero), 11% in Kentucky (1%), 18% in Tennessee (2%) and 7% in North Carolina (3%). FBN

Kansas City hard winter premiums, 12.2% No. 1 hard spring
cents per bu Basis Minneapolis Sept., delivered Chicago/beyond 150 cents per bu 130 Aug. 24 — Change from — Year Premium Aug. 17 Aug. 10 ago 110 Ordinary ... ... ... … 90 11% ... ... ... … 12% ... ... ... 75 70 13% ... ... ... 75 50 13.5% ... ... ... … N F M 14% 20 @ 50 -25 @ -10 -30 @ 0 90@ 100 A Cash wheat 14.5% ... ... ... 90@ 125 15% 45 @ 60 -5 @ -10 -10 @ -20 100 Aug. 24 — Change from — Year 16% ... ... ... … For shipment Bid Aug. 17 Aug. 10 ago Exporter bids and offers No. 1 Soft White, Track, Portland $ per bu For Aug. 24 Year ago August 8.90 +.10 +.15 … shipment Bid Offer bid September 8.90 +.10 +.15 7.14 No. 1 Hard 12%, Track Gulf October 8.90 +.10 +.15 7.23 Basis Kansas City future, cents per bu No. 1 Hard 11.5%, Track, Portland August … … … Basis Kansas City future, $ per bu September +110 Sep. … +100 Sep. August 0.50 — ... … October +105 Dec. … +95 Dec. September 0.55 — -.03 … November +110 Dec. 120 +95 Dec. October 0.50 — +.05 0.45 No. 2 Soft Red, c.i.f. New Orleans No. 1 Spring 14%, Track, Portland Basis Chicago future, cents per bu Basis Minneapolis future, $ per bu August +50 Sep. … +33 Sep. August ... ... ... … September +55 Sep. … +45 Sep. September 0.60 — — … October +55 Dec. … +40 Dec. October 0.70 — — 1.15 November +60 Dec. … +50 Dec.

No. 1 hard winter
Basis Kansas City Sept., cents per bu Aug. 24 — Change from — Premium Aug. 17 Aug. 10 Ordinary 50@ 65 +15 @ +15 +25 @ +25 11% 55@ 70 +20 @ +20 +22 @ +22 11.2% 60@ 75 +20 @ +20 +25 @ +25 11.4% 75@ 90 +14 @ +14 +25 @ +25 11.6% 86@ 101 +16 @ +16 +36 @ +36 11.8% 86@ 101 +16 @ +16 +36 @ +36 12% 87@ 102 +17 @ +17 +37 @ +37 12.2% 87@ 102 +17 @ +17 +37 @ +37 12.4% 89@ 104 +19 @ +19 +32 @ +32 12.6% 92@ 107 +22 @ +22 +35 @ +35 12.8% 92@ 107 +22 @ +22 +27 @ +27 13% 95@ 110 +20 @ +20 +20 @ +20 13.2% 95@ 110 +15 @ +15 +15 @ +15 13.4% 95@ 110 +10 @ +10 +10 @ +10 13.6% 95@ 110 +10 @ +10 +10 @ +10 13.8% 95@ 110 +10 @ +10 +10 @ +10 14% 100@ 115 +15 @ +15 +15 @ +15 Year ago 42 @ 57 46 @ 61 46 @ 61 55 @ 70 68 @ 83 68 @ 83 75 @ 90 75 @ 90 75 @ 90 80 @ 95 80 @ 95 80 @ 95 80 @ 95 80 @ 95 85 @ 100 96 @ 111 102 @ 117

August 28, 2012

FOODBUSINESS NEWS

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Food Business News - August 28, 2012

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