Titolo: 21:18 DJ U.S. Cash Grain Markets: Spring-Wheat Basis Collapses
Testo: --U.S. spring-wheat cash markets weaken due to ample supplies and large U.S. and Canadian harvests
--Weak wheat-export demand also pressures cash markets
--End of Canadian Wheat Board monopoly on the country's wheat sales could change usual basis trend late in year
By Owen Fletcher
CHICAGO--Spring-wheat cash markets have weakened this week due to ample supplies and large harvests in the U.S. and Canada.
Basis, or the difference between spot prices and futures, for 14%-protein spring wheat sold at the MGEX in Minneapolis was 7 to 10 cents above December futures on Wednesday, according to the U.S. Department of Agriculture. Two weeks earlier, basis was 30 to 40 cents above nearby futures.
Spring-wheat cash basis is at "multiyear lows," said Tregg Cronin, an analyst with brokerage Country Hedging in St. Paul, Minn. "We've just got incredibly large stocks in the country and very few homes" for the wheat, he said.
Some demand for spring wheat, a high-protein variety used to make bread flour, has been displaced by a U.S. winter-wheat crop that also had healthy protein levels, Mr. Cronin said.
Lackluster export demand is also pressuring wheat basis. Egypt, the world's top wheat importer, has repeatedly turned to Russia, Romania and Ukraine for wheat purchases in the last several weeks, highlighting how high prices are making U.S. wheat less competitive in export markets.
The nearly complete U.S. spring-wheat harvest has surpassed expectations, and analysts also expect a large crop in Canada, where harvest is ongoing.
Spring-wheat basis usually strengthens heading into December as sales of Canadian wheat slow, though this year could be different due to the end of the Canadian Wheat Board monopoly on the country's sales, said Bryce Knorr, an analyst with Farm Futures, an agricultural publication.
"Once we get the crop locked up I would expect some type of basis strengthening, but the supplies are adequate enough that it doesn't look like we're going to get into any really tight situation that would get the basis pumped up," Mr. Knorr said.
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