Weekly Market Highlights
- Hard red spring wheat futures and high protein spring wheat basis premiums have fallen since our last communication two weeks ago.
- Hard red winter wheat futures and basis premiums are higher, reflecting strong demand for protein and quality that is in short supply.
- Hard red winter wheat basis continues to trade at the highest levels since 2008. Protein is expensive, 13% protein milling wheat commands an astounding $1.41 per bushel premium over 11% protein milling wheat.
- The U.S. winter wheat crop is in good condition but could use some rain. Area planted to this year’s crop is the smallest in records back to 1919. Reduced acres equate to low or negative return on planting costs for growers which could lead to even tighter and more expensive supplies in coming crop years.
- We expect prices to remain in a narrow range until wheat markets find a new compelling story to lead them to trade higher.
Facts on Flour
When we talk “flour,” we are talking about wheat flour. Because wheat is the most commonly distributed cereal grain in the world, a reference to flour is generally a reference to wheat flour.
And just as flour is not “just flour,” wheat is not “just wheat.” Wheat can be classified by three major categories: growing season (winter, spring), kernel hardness (hard, soft) and bran color (red, white). These categories have a significant impact on the functionality of the finished flour.
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