Data from the USDA's weekly Pacific Northwest Grain Market News indicates exporter's bids for dark northern spring (DNS) 13% protein have ranged from $9.01 1/2 per bushel to $9.42 1/4 between December 20, 2012 and June 13 2013, as noted by the red line on the attached chart. The average of the noon price range which is reported weekly and delivered to Portland, Oregon, has tested support near the $9/bu. floor on six occasions, including the most recent average price reported at $9.02 1/2/bu.
The green line represents the weekly price paid for 14% protein DNS, based on an average of the noon reporting range each week. The spread between the green line and the red line represents the premium for 14% over 13% protein as determined by the PNW cash market, and started the month of August at 27 1/2 cents/bu. ($10.10/mt) and has gradually narrowed to the most recent report at 16 cents/bu. ($5.88/mt), largely based on significant supplies of protein available. It will be interesting to watch this spread moving forward as the market comes to grips with planting delays and the potential impacts of a late-seeded crop. Note that while not seen on the chart, 15% protein prices are also quoted although have been identical to the 14% protein price, meaning that the premium paid was for 14% or higher.
The nearby Minneapolis close has also been posted, as seen by the blue line, to better understand the trend between futures and cash prices.
Also of interest is the spread between old crop and new crop. The latest report suggests October bids for 14% protein ranged from $8.87 to $9.07/bu. on June 13. The average is $8.97/bu., which reflects a 21.5-cent ($7.90/mt) discount to the current 14% protein bid.
Cliff Jamieson can be reached at firstname.lastname@example.org
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