Milling & Baking News - January 8, 2013 - 36

Ingredient Week 

Wheat Futures
Wheat futures prices continued to drop last week and set new six-month lows. The current downtrend in wheat futures prices began in late November. From Nov. 28 through Jan. 4, the Kansas City March future lost about $1.32 a bu, the Chicago March future plunged about $1.43 a bu and the Minneapolis March contract dropped about $1.12 a bu. Winter storms brought snow and rain to parched areas of the hard winter wheat belt as well as to the Central states during the past two weeks. Toward the end of New Year’s week, snow cover stretched across the hard winter wheat belt as far south as the Kansas-Oklahoma border. But moisture content was limited and much more precipitation was needed. Forecasts were not promising in that regard for the rest of the winter in hard winter wheat states, although veteran crop observers reminded the market spring weather ultimately will determine the fate of the 2013 crop. Winter wheat conditions were much better in the eastern Corn Belt and in Illinois, where moisture was adequate. The U.S. Department of Agriculture field office in Illinois rated the state’s winter wheat crop as of the end of December at 70% good to excellent, which marked a slim improvement from a month earlier. In

contrast, three of four hard winter wheat states updating their crop condition ratings at the end of December indicated ratings weakened. Hard winter wheat rated in good to excellent condition was 24% in Kansas, 11% in Oklahoma and 37% in Nebraska. Montana wheat condition improved to 40% good to excellent. The U.S.D.A. indicated net export sales of U.S. wheat during the week ended Dec. 27 totaled 400,400 tonnes, down 60% from a week earlier and down 37% from the prior four-week average. Export sales of more than 1 million tonnes registered the previous week constituted a two-year high. Despite recent heavy sales abroad, analysts suggested the pace lagged that required to meet the current U.S.D.A. wheat export forecast for 2012-13. Corn and soybean futures prices dropped, helping pave the way lower for wheat futures prices. A rising value of the U.S. dollar in the wake of the passage of the American Taxpayer Relief Act also exerted pressure on grain futures. MBN

Millfeed
Prices were mostly lower, some sharply, at the end of back-to-back holiday weeks when flour mill grind was cut back aggressively, leading to steep nearby premiums. Trading was generally light

because most buyers had booked coverage before the holidays. But those in need of millfeed around New Year’s had to “pay up” in the spot market until prices began to fall with the resumption of a more typical flour grind. Brokers estimated it would be several more days before a normal trading environment erased effects of the holidays. Spreads between bids and offers, which widened immediately after New Year’s day, started to narrow as the weekend approached. Despite nearby volatility, steady demand from livestock producers facing cold weather and snow may have kept a floor under prices. Millfeed competed well with other possible ingredients in some locations but not all. Last week, January became the nearby contract, and traders noted some interest in deferred months, but some potential buyers remained on the sidelines, waiting for further price declines. Millfeed was $185 a ton in Kansas City and $204 in Minneapolis, on a rail basis, compared with corn at $252 a ton and sorghum at $236 a ton, both K.C. Corn gluten feed was steady at $235 a ton, distillers’ dried grain was down $5 at $255 a ton, and dehydrated alfalfa was steady at $355 a ton, all K.C. Wheat germ held steady. MBN

Wheat futures
$ per bu; change in cents per bu Jan. 4 Kansas City March May July September Chicago March May July September Minneapolis March May July September 8.04½ 8.13¼ 8.17¾ 8.28 7.47¼ 7.56¾ 7.63¼ 7.74¾ 8.41 8.50¼ 8.59¼ 8.58 — Change from — Dec. 28 Dec. 21 -21½c -22¾c -25¾c -27¼c -31½c -31¾c -31¾c -33¼c -26¾c -28¾c -28¼c -29¼c -37½c -38¾c -39¼c -41¾c -44¾c -45¼c -45½c -46c -40½c -41½c -41c -42c Week’s High Low 8.41 8.48¼ 8.56¼ 8.65 7.88 7.97 8.02¾ 8.15 8.71½ 8.81½ 8.89½ 8.89¼ 7.96¾ 8.05¾ 8.10 8.22¾ 7.39¾ 7.49 7.55¾ 7.68½ 8.36 8.46 8.55¾ 8.57¼ Year ago 6.80 6.88½ 6.97 7.09¾ 6.24¾ 6.43¾ 6.60¼ 6.76½ 8.01 7.92¾ 7.86¾ 7.74 High 9.86½ 9.85 9.50 9.46¾ 9.82 9.72 9.47 9.05¾ 10.34½ 10.19¼ 10.00 9.70 Season’s Low (05-25-11) (05-25-11) (05-26-11) (11-29-12) (05-26-11) (05-26-11) (05-26-11) (11-08-12) (07-23-12) (07-01-12) (07-20-12) (09-14-12) 6.64½ 6.74 6.80¼ 6.87¾ 6.52 6.65 6.63 6.79 7.43 7.53½ 7.60 7.48 (05-14-12) (05-11-12) (05-14-12) (12-14-11) (05-14-12) (05-14-12) (11-25-11) (11-25-11) (05-14-12) (05-11-12) (06-05-12) (06-01-12)
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Kansas City wheat futures
March contract, $ per bu
$10.50 $9.00 $7.50 $6.00 A J
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Chicago wheat futures
March contract, $ per bu
$10.20 $8.60 $7.00 $5.40

Bulk middlings
$ per ton, delivered rail unless noted N=Nominal Spot Kansas City 185 @ 195 Southwest, f.o.b. truck 242 @ 252 Minneapolis 204 @ 214 Upper Midwest, f.o.b. truck 200 @ 210 Chicago West 217 @ 227 Central states, f.o.b truck 215 @ 225 Buffalo 200 @ 210 Southeast 185 @ 195 N. & S. California 219 @ 239 Los Angeles, f.o.b. truck 215 @ 235 Paciﬁc Northwest 240 @ 260 Upper Midwest, sacked 320 Wheat germ 290 @ 310
36 / January 8, 2013 Milling & Baking News

Jan. 182@ 192 225@ 235 204@ 214 200@ 210 217@ 227 195@ 200 185@ 195 175@ 185 214@ 234 210@ 230 240@ 260

— Change from — Year Dec. 28 Dec. 21 ago -23 @ -28 -18@ -28 160 @ 166 -30 @ -30 -30@ -30 175 @ 180 -50 @ -55 -45@ -50 149 @ 157 -50 @ -55 -45@ -50 145 @ 153 -50 @ -55 -45@ -50 162 @ 170 -50 @ -60 -60@ -65 150 @ 158 -35 @ -40 -45@ -50 140 @ 150 -10 @ -10 -25@ -25 135 @ 140 -15 @ -15 -15@ -15 184 @ 199 -15 @ -15 -15@ -15 180 @ 195 — — 185 @ 200

Jan.-Mar. 170 @ 178 210 @ 220 189 @ 194 185 @ 190 202 @ 207 180 @ 190 165 @ 172 150 @ 160 209 @ 229 205 @ 225 240 @ 260

Apr.-June 140@ 146 180@ 190 164@ 174 160@ 170 177@ 187 155@ 165 125@ 140 125@ 135 186@ 206 182@ 202 240@ 260

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Minneapolis wheat futures
March contract, $ per bu
$10.75 $9.75 $8.75 $7.75 $6.75 J A J
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Milling & Baking News - January 8, 2013

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