Milling & Baking News - April 13, 2004 - 40

I N G R E D I E N T

W E E K

Bakery Flour
In the market for bakery flour last
week, there was resistance to booking
needs into the new crop year, even while
business for remaining April and May
coverage was fairly brisk. Price changes
weren't significant.
Bakers continued to expect or hope
that wheat futures prices would break in
the next several weeks. Buyers expected
export demand for U.S. wheat to fall off
as it typically does in the final weeks of
the marketing year for old crop. Crop
conditions in other Northern Hemisphere producing countries seemed to be
favorable. And barring currently unforeseen weather threats to the U.S. crop, and
even if plantings are down from a year
ago, the prospect of new crop wheat beginning to flow into marketing channels
could pressure prices.
In pan bread flour, bakers actively
plugged gaps in April coverage and
added to the ownership of May needs.
Coverage for April-June was heavily
front-loaded. For many bakers, ownership for June was minimal to nonexistent.
It was estimated at the week's end that
about 50% of April-June coverage had
been taken, which meant that a lot of
business was yet to be done even for May.
Activity was similar in the market for

Carlot Bakery Flour Prices

spring grades. There was little interest in
booking new crop. Distributors and other
users of sacked flour, especially those in
the Northeast, bought what was required
to extend contract balances through April
and in instances up to mid-May.
The market for soft flour was mostly
quiet last week. Cookie-cracker and specialty bakers already had taken more extensive ownership in April-June than the
bread and bun bakers, and they, too, were
wary of extending contract balances beyond current limits.
Flour mill grind in advance of the
Good Friday-Easter weekend was somewhat heavier than earlier projected.
Southwest mills operated 4½ to five days,
and Upper Midwest units came in at 4½.
Mills in the Central states averaged close
to 4½ days, and those at Buffalo and adjacent eastern areas ran four to 4½, Southeast mills averaged 4½ days. In California, mills turned out close to 5½, while
Pacific Northwest mills operated days. MBN

Wheat Futures
After a week of choppy trading, wheat
futures prices on the three exchanges registered mixed and, when compared with
recent wide gains, fairly minor changes.
Declines were confined to old crop contracts in Kansas City and Chicago. In Minneapolis, all contracts gave ground,

Bakers Standard Patent, Kansas City

Bulk, f.o.b. car, $ per cwt

Bulk, f.o.b. car, $ per cwt
April 8

April 2

Year
ago

Kansas City
Bakers standard patent

11.40

11.50

10.40

Minneapolis
Spring standard patent
High gluten

11.45
13.70

10.70
12.20

Chicago
Cracker

11.55

11.70

10.05

Spring Standard, Minneapolis

Cracker Flour, Chicago

Bulk, f.o.b. car, $ per cwt

though new crop losses were minimal. It
seemed the market was catching its breath,
balancing the influence of old crop supply and historically strong yet erratic corn
and soy complex futures markets against
the imminent approach of a new crop both
in the United States and in other Northern Hemisphere producing countries.
The U.S. Department of Agriculture on
April 8 projected the 2004 carryover of
wheat on June 1, 2004, at 531 million bus,
down 13 million bus from the March forecast but up 40 million bus from the 2003
carryover of 491 million bus. The Department raised its wheat export projection
for 2003-04 by 15 million bus, to 1,165
million. Some private analysts had expected a decrease with so much wheat
currently on the books for the year yet to
be shipped. The Department left unchanged its projection of feed and residual use of wheat in the current year at
225 million bus.
In contrast, the U.S.D.A. raised its projection of 2003-04 world wheat ending
stocks by 2.53 million tonnes from the
March forecast, to 127.46 million tonnes.
While ending stocks still would be down
40.02 million tonnes from the year before
and remain the lowest since 1981-82, the
market anticipated an expansion in
world production in the coming year to
nearly 600 million tonnes, compared
with 549 million tonnes in 2003-04. The
projection of China's import demand for
2003-04 remained at 2 million tonnes.
Export wheat sales in the week ended
April 1 of 456,900 tonnes for 2003-04 and
130,000 tonnes for 2004-05 were within
the range of expectations.
The U.S.D.A. issued its first composite
rating for the winter wheat crop of the
season last week. The winter wheat crop
was rated 48% good to excellent versus
51% last year. Conditions in the key soft
red winter states generally were strong.
The hard winter crop struggled with
lower ratings, though improvements
were beginning to be registered in Kansas, and rain was forecast for the parched
western areas, including west central and
northwest Kansas, southwestern Nebraska and eastern Colorado. MBN

Cash Wheat
HARD WINTER. Premiums on hard red
winter and dark hard wheat in Kansas
City declined 2@4c a bu last week. Weakness was most evident early in the week
and reflected non-pressing mill demand
and weaker bids on wheat from export
elevators at the Gulf. The basis steadied
on Wednesday and Thursday, with renewed strength in the market at the Gulf
a factor. While pipelines could not be
characterized as full, mills and other
wheat buyers were wary of buying wheat
40 / Milling & Baking News, April 13, 2004

bakingbusiness.com / world-grain.com

http://www.bakingbusiness.com http://www.world-grain.com

Milling & Baking News - April 13, 2004

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