1. Wheat
By Luke Mason
10 November 2018

4. Global situation Burdensome global stocks but mainly low quality
Large feed grain stocks – US Corn & South American corn production rebound
Milling wheat demand hand to mouth amidst tightening supplies of 12.5 pro & higher
Quality disasters in all major origins
Acreage reductions necessary for next year, happened in US but Russian acreage is higher

5. Low grade Wheat Supply Ukraine was the early market driver
HRW low protein year abundant
Russian Feed Wheat
Sprouting 6 – 8 MMT
Canadian Feed Wheat
Durum weather damaged circa 4MMT?
Australia Low Pro
Likely ASW and lower surplus to be above 18 MMT
Argentina 10.5 Pro
3 - 4 MMT

6. Global Stocks

7. Global S&D highlights
Australia's production reached 35mmt, with 22mmt exports expected
Argentina's wheat production at 14.7mmt , while exports higher by +400kmt at 8.5mmt
US - Record C/O at 1.186bbu
Higher demand yoy from India will lead to an additional +1.5mmt of wheat trade
Russia's crop at 71mmt. C/O are record high at close to 15mmt

8. World Milling Wheat FOB Comparisons

9. Summary India demand supportive Ukraine exports well ahead of pace
Huge wheat stocks globally of low quality wheat
Big US corn stocks and competition from Blacksea, Argentina
Asian feed wheat demand slow
Tight origin price spreads likely to remain amidst stiff competition at destinations

11. Australia CROP Estimates
REGION
PRODUCTION
QLD
2,374,445
NSW
11,512,955
VICTORIA
4,874,237
SOUTH AUSTRALIA
6,502,337
WESTERN AUSTRALIA
10,127,536
TOTAL
35,391,510

12. Australia CROP quality
CQ - predominantly H2 & APH2 with smaller quantities of lower grades
SQ - APW1 & H2 dominant grades probably 60%
NNSW - H2/APW1/ASW dominant grades - 20/30/30 with 20 % lower grades
SNSW - APW1/ASW1 dominant grades - 30/40 with 10% H2 and 20% lower grades
Vic - similar to SNSW.

13. Australia CROP average protein levels
REGION (ASW)
PROTEIN LEVELS
WESTERN AUSTRALIA
8.9
SOUTH AUSTRALIA
9.3
VICTORIA
NEW SOUTH WALES
9.2
REGION (APW)
PROTEIN LEVELS
WESTERN AUSTRALIA
10.6
SOUTH AUSTRALIA
10.7
VICTORIA
NEW SOUTH WALES
10.8

14. Australia Wheat s&d