Bookings of bakery flour were limited last week. Prices were unchanged for soft flour but higher for the other grades.
Most bakers and other flour buyers were found on the sidelines as wheat futures prices bounced from the wide losses sustained the previous week, which saw a moderate expansion in flour bookings with bakers filling gaps in November-December coverage and making minor additions to first-quarter 2010 ownership. The softer wheat futures market then also encouraged individual bakers to cover the futures component of prospective flour bookings deep into 2010. The futures price bounce last week that held through midweek largely put an end to that activity. Most recent bookings were limited to finishing business for December. In the market for pan bread flour, November-December coverage remained at about 75% to 80% completed, and ownership of first-quarter 2010 needs was at about 50% taken.
In the market for spring grades, a few specialty bread bakers inquired about cash hard red spring wheat premiums for January-March, and at least a little business was concluded. The interest was tied to a desire to assure minimum protein levels in the wheat from which their flour will be ground. Millers also indicated interest in the deferred soft red winter wheat basis, which was reflected in increasing open interest and escalating value of the soft red winter wheat index traded and quoted on the Minneapolis Grain Exchange. There was no significant fresh interest in booking the hard red winter wheat basis into 2010.
Scattered bakers also took advantage of seasonally strong millfeed values to cover that component of prospective first-quarter flour bookings.
The Commodity Credit Corp. bought 37,310 tonnes (822,686 cwts) of all-purpose flour at $firstname.lastname@example.org per tonne ($email@example.com a cwt) for donation to Pakistan (24,510 tonnes) and Kenya (12,800 tonnes); shipments will be spread out from Dec. 16 through Feb. 28. One milling company captured most of the business, and it was noted the shipping dates should help give its mill grind a boost during the winter.
Mill grind was about 5½ days in the Southwest. 5½ to six in the Upper Midwest and 5½ to seven in the Central states. Northeast grind was at five to six days, and Southeast grind was about five. West coast mills ran around six days.
Sales of national and regional brands of family flour remained seasonally brisk. Carlot list prices were unchanged.
Additional ads were in evidence where grocers and other outlets offered two 5-lb bags of family flour for $4, and national brands were seen offered at around $2.29 a bag in several markets. Ideas were more aggressive product promotion may make an appearance before Thanksgiving.
Market participants eagerly awaited category volume data for October. Some expected the data to indicate little change from a year ago, but this in itself would be welcomed in a market where typically volume declines 2% to 3% annually.
Bookings of semolina, granulars and durum flour were limited last week. Prices declined.
The price of choice milling hard amber durum in Minneapolis was $5.70 a bu, although in the absence of trading, it was difficult to find consensus. The durum harvest was completed and grain was shipped against contract. But farmers put their uncommitted durum into bins and seemed in no hurry to increase durum sales. Because of the large crops in both the northern Plains and Canada, there was no concern about supplies in 2009-10, and pasta manufacturers felt little pressure to be more aggressive in covering forward requirements.
Semolina coverage through December was solid. First-quarter 2010 coverage was estimated at about 75%, and April-June coverage was estimated at 25% to 30%.
Durum mill grind lost some luster with units operating about 5½ days compared with weekly runs of six days and more for the past several weeks.