The Good: Buried deep in the weekly export sales report was a bullish set of numbers for U.S. durum. For the week ending on July 16th, durum sales totalled 35,099 tonnes with shipments hitting 22,099 tonnes. The total exports so far this year totalled 158,785 tonnes, which is the largest since the 1997-98 crop year. Total sales are also strong at 203,000 tonnes which brings commitments to 361,785 tonnes. These are the strongest commitments at this point of the crop year since 2007. The only other years that are comparable are 2019-20 (last year) and the 2010-11 marketing year.
The Bad: Spring wheat futures continue to push lower as the nearby September contract dropped four cents per bushel at the end of the trading session. The main concern is that spring wheat futures appear to be headed back to testing the lows set on Monday. This lower move comes despite strong HRS net sales of 156,257 tonnes for the week ending on July 16th. Tomorrow will be an important day from a technical point of view for the spring wheat contract. The market needs to hold above the contract low or next weeks action could be ugly.
The Ugly: Although the number of daily COVID19 cases in the U.S. is beginning to level off, the damage to the economy in the southern states is increasing as people stay at home – order or not. The number of new unemployment claims hit 1.42 million last week in the U.S. which is the first increase in applications since late March. The number of COVID-19 cases in the U.S. passed 4.0 million today which indicates that the economy is likely to continue to slow.