Wheat/Corn
After a gradual decline over the last month, grain markets jumped after release of the USDA’s
September 11th crop report. Wheat futures are just a tad lower today versus 30 days ago, corn futures
are slightly higher. The driver of the market increase was corn, with ending stock estimates revised
down by 121M bushels, mainly due to lower new crop estimates. Wheat ending stocks were revised to
slightly higher levels, though the final new crop estimates will not be published until September 30th.
The wheat market has increased mainly due to corn. We should see a tightening of the spread between
corn and wheat. Weather overall looks favorable for the corn and soybean harvests, which are still in
their early stages. Soft winter wheat basis is still very high due to excessive rain at harvest which has
decreased wheat quality (protein). In some areas hard winter wheat flour is currently at lower prices
than soft winter wheat flour.