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Wheat May 2012 (ZWK12)

597-6s+5-0 (+0.84%) 7:52P EDT (CBOT)
Commodity Price Quote as of Monday, May 20th, 2013 View Help

Contract Specifications

Symbol ZW
Name Wheat (ZW)
Exchange CBOT
Trading Months March, May, July, September, December (H, K, N, U, Z)
Trading Unit 5,000 bushels
Tick Size 1/4 cent per bushel ($12.50 per contract)
Daily Limit 60 cents per bushel ($3,000 per contract)
Trading Hours 7:00p.m. - 7:45a.m. and 8:30a.m. - 1:15p.m. (Sun-Fri) CST
Last Trading Day The business day prior to the 15th calendar day of the contract month
Value of one futures unit $50
Value of one options unit $50

CRB Yearbook Description

Wheat is a cereal grass, but before cultivation it was a wild grass. It has been grown in temperate regions and cultivated for food since prehistoric times. Wheat is believed to have originated in southwestern Asia. Archeological research indicates that wheat was grown as a crop in the Nile Valley about 5,000 BC. Wheat is not native to the U.S. and was first grown here in 1602 near the Massachusetts coast. The common types of wheat grown in the U.S. are spring and winter wheat. Wheat planted in the spring for summer or autumn harvest is mostly red wheat. Wheat planted in the fall or winter for spring harvest is mostly white wheat. Winter wheat accounts for nearly three-fourths of total U.S. production. Wheat is used mainly as a human food and supplies about 20% of the food calories for the world's population. The primary use for wheat is flour, but it is also used for brewing and distilling, and for making oil, gluten, straw for livestock bedding, livestock feed, hay or silage, newsprint, and other products.

Wheat futures and options are traded on the Mercado a Termino de Buenos Aires (MATBA), Sydney Futures Exchange (SFE), JSE Securities Exchange of South Africa, National Commodity & Derivatives Exchange of India, NYSE-LIFFE exchange in London and Paris, Budapest Stock Exchange (BSE), the Chicago Board of Trade (CBOT), the Kansas City Board of Trade (KCBT), and the Minneapolis Grain Exchange (MGE). The Chicago Board of Trade's wheat futures contract calls for the delivery of soft red wheat (No. 1 and 2), hard red winter wheat (No. 1 and 2), dark northern spring wheat (No. 1 and 2), No.1 northern spring at 3 cents/bushel premium, or No. 2 northern spring at par.

Prices - CBOT wheat prices started out 2011 on a strong note as they posted a 3-1/2 year high of $8.93 a bushel in February 2011 due to strong demand for U.S. wheat on scant European supplies, Russia's ban on wheat exports, and on quality issues for Australian supplies because of flooding. Another bullish factor was reduced wheat plantings in Canada, the world's second-largest exporter, after 2011 Canada wheat acres planted estimate dropped to 20.35 million acres, the second-smallest acreage since 1971. Wheat prices then ratcheted lower into summer and in July 2011 posted a 1-1/2 year low of $5.65 a bushel after Russia announced it would lift its wheat export ban starting July 1 and after the USDA hiked its U.S. winter-wheat production estimate for the second straight month to 1.492 billion bushels from a May estimate of 1.424 billion bushels. Wheat prices moved sideways the remainder of the year and finished 2011 down -17.8% at $6.53 a bushel. Keeping pressure on wheat prices in late 2011 was (1) the action by Australia, the world's third-largest wheat exporter, to raise its 2011/12 wheat crop estimate to a record 28.3 MMT and to raise its wheat export estimate to a record 21.6 MMT, (2) Argentina's action to boost its 2011 wheat exports to a record 11.1 MMT and (3) the USDA's hike in its 2012 global wheat ending stocks estimate to a 12-year high of 208.52 MMT. The 2011/12 wheat supply situation is ample with the stocks-to-use ratio at 39.5% for the U.S. and 31.2% globally.

Supply - World wheat production in the 2011-12 marketing year rose +6.3% to 692.875 million metric tons, a new record high. The world's largest wheat producers were the European Union with 19.8% of world production in 2011-12, China (17.0%), India (12.5%), Russia (8.1%), the U.S. (7.8%), and Australia (4.1%). China's wheat production in 2011-12 rose +2.4% yr/yr to 117.920 million metric tons, but is still below its record high of 123.289 million metric tons seen in 1997-98. Australia's wheat production rose +1.5% yr/yr to 28.300 million metric tons in 2011-12, a new record high. The world land area harvested with wheat in 2011-12 fell -0.2% yr/yr to 222.3 million hectares (1 hectare equals 10,000 square meters or 2.471 acres), remaining above the 209.6 million hectares in 2003-04, which was the smallest wheat harvest area since 1970-71. World wheat yield in 2011-12 rose +5.5% to 3.07 metric tons per acre, a new record high.

U.S. wheat production in 2011-12 fell -9.4% yr/yr to 1.999 billion bushels, well below the record crop of 2.785 billion bushels seen in 1981-82. The U.S. winter wheat crop in 2011 rose +0.6% yr/yr to 1.493 billion bushels, which was well below the record winter wheat crop of 2.097 billion bushels seen in 1981. U.S. production of durum wheat in 2011 fell -52.4% yr/yr to 50.482 million bushels. U.S. production of other spring wheat in 2011 fell -26.1% yr/yr to 455.188 million bushels. The largest U.S. producing states of winter wheat in 2011 were Kansas with 5.2% of U.S. production, Washington with 8.7%, Montana with 6.0%, and Colorado with 7.9%. U.S. farmers planted 54.409 million acres of wheat in 2011, which was up +1.5% yr/yr. U.S. wheat yield in 2011-12 was 43.7 bushels per acre, under last year's record high of 46.3 bushels per acre. Ending stocks for U.S. wheat for 2010-11 (latest data) were at 818.0 million bushels, down 16.2% yr/yr.

Demand - World wheat utilization in 2011-12 rose +3.3% yr/yr to a record high of 673.3 million metric tons. U.S. consumption of wheat in 2011-12 rose +2.9% yr/yr to 1.161 billion bushels, which was below the record high of 1.381 billion bushels seen in 1998-99. The consumption breakdown shows that 80.5% of U.S. wheat consumption in 2011-12 went for food, 12.5% for feed and residuals, and 7.0% for seed.

Trade - World trade in wheat in 2011-12 rose +3.2% yr/yr to 136.6 million metric tons, down from 2008-09 record high of 143.0 million metric tons. U.S. exports of wheat in 2011-12 fell -26.3% yr/yr to 950.000 million bushes, and remained below the record of 1.771 billion bushels of exports seen in 1981-82. U.S. imports of wheat in 2011-12 rose +23.8% to 120.0 million bushels, down from the 2006-07 record high of 127.0 million bushels.

Articles from the Commodity Research Bureau (CRB) Commodity Yearbook. The single most comprehensive source of commodity and futures market information available, the Yearbook is the book of record of the Commodity Research Bureau, which is, in turn, the organization of record for the commodity industry itself. Its sources - reports from governments, private industries, and trade and industrial associations - are authoritative, and its historical scope is second to none. Additional information can be found at www.crbyearbook.com.
More commodity data from Commodity Research Bureau.