Wheats Rallying into Tuesday with Black Sea Updates

Wheat prices are rallying as much as 3% in early Tuesday market activity after a dam was bombed in Kherson Ukraine. CBT SRW prices were up by 3 1/2 to 5 cents by the Monday close. KC HRW ended with 7 3/4 to 10 cent gains across the front months. Spring wheat futures led the way with Monday gains of as much as 16 1/2 cents. 

The Russia/Ukraine War saw a Ukrainian dam near Nova Kakhovka in the South/Southeast portion of the country. Kherson makes up ~5% of the yearly production. 

The weekly Crop Progress data showed winter wheat harvest reached a reportable amount, at 4% nationally. That matches the average pace and includes 29% for TX, 15% for OK, 8% for NC, 1% in MO, and 14% for AR. Nationally, 18% has not yet headed compared to 19% on average. Winter wheat condition ratings were higher again @ 293 on the Brugler500. Colorado, KS, NE, OK, and TX were all improved for the week, while IN, MI, OH, and WA worsened. 

NASS data showed 7% of spring wheat remains to be planted as of 6/4 which matches the average. Emergence was shown at 76%, 2 ppts ahead of average. The initial spring wheat ratings were 64% good/ex for a Brugler500 conversion of 368. That ranges from a 351 in WA to a383 in MN and compares to last year’s initial score of 348. 

Analysts are looking for 5.5 mbu looser wheat carryout ahead of the monthly USDA report. The full range of estimates is from 592 mbu to 643 mbu vs. 598 in the May report. New crop wheat stocks ideas average 566 mbu going in, which would be 10.2 mbu looser if realized. Traders are looking to see a 6.5 mbu increase for wheat output on average – with HRW expected at 518 mbu and SRW at 414.5.

Australia’s ABARES estimates the 23/24 wheat crop will total 26.2 MMT, which would be a 34% decline from 2022/23 – citing anticipated El Nino impacts. 

Jul 23 CBOT Wheat  closed at $6.24, up 5 cents, currently up 20 1/4 cents

Sep 23 CBOT Wheat  closed at $6.36 1/4, up 4 cents, currently up 19 cents

Cash SRW Wheat  was $5.73 1/4, up 5 cents,

Jul 23 KCBT Wheat  closed at $8.22 1/4, up 10 cents, currently up 22 1/4 cents

Cash HRW Wheat  was $7.83 7/8, up 9 3/8 cents,

Jul 23 MGEX Wheat  closed at $8.20 1/4, up 12 1/2 cents, currently up 15 3/4 cents