20mmt Aug. spring wheat trade on MGE

[TOM4CWB]

Charlie;

One of the CWB's past points has been that the MGE Spring wheat futures is too thinly traded...

Obviously the August trade alone is twice the whole CDN crop this year!

"MINNEAPOLIS—The Minneapolis Grain Exchange (MGEX) announced today that hard red spring wheat futures volume for August 2002 was the highest monthly volume total in the history of the contract, which has been traded at the exchange since 1883. Total monthly volume was 151,950 contracts, the equivalent of 759,750,000 bushels of wheat. The prior all-time monthly volume record for hard red spring wheat futures was recorded in June 1999 when 145,620 contracts were traded."

Is there any way to find out how many contracts the CWB traded?

[charliep]

No way to find out who traded what that I know of.

Much of the extra volumes would have reflected the increased volatility during August and increased speculator activity. People like to buy into winners. Likely some spread activity as well. Any North American flour mill with price risk exposture would also likely to stepping up to the plate to reduce their price risk exposure.

[TOM4CWB]

Charlie,

If the CWB is trading on the exchanges, who keeps track?

I can see who and what is being done on the exchanges by the following:

"Both the total U.S. and Canadian wheat crops have already been estimated by government agencies at their lowest levels in about three decades.

CHICAGO BOARD OF TRADE

CBOT wheat futures ending sharply higher, gaining momentum and building on gains after open narrowly mixed.

Early on strength spilled over from CBOT corn futures. But once the session concluded, CBOT Dec wheat had gained 7 3/4c on CBOT Dec corn with the spread between those two contracts settling at 107 3/4c, its widest point of the season.

Fimat was the noted buyer throughout the day, taking almost 2,000 Dec. Cargill/Cargill Investor Services and Rand Financial each purchased about a net 400 Dec as well, but overall buying interest was spread out among firms.

Goldenberg Hehmeyer bought 500 Dec $3.60 puts.

KANSAS CITY BOARD OF TRADE

KCBT Dec climbed to a new contract high of $4.38 in the closing minutes of trade, pushing well past Tuesday's contract high of $4.24 1/2.

Refco bought a net 300 Dec, while Fimat and Cargill Investor Services each purchased a net 200 Dec. Prudential Securities, Country Hedging and Term Commodities bought a net 100 Dec a piece.

Man Financial sold a net 500 Dec, but also bought 300 Mar. FC Stone and ADM Investor Services each sold about a net 200 Dec.

MINNEAPOLIS GRAIN EXCHANGE

In what seems like deja vu, all major MGE wheat months hit contract highs again. But this time the new marks were set in dramatic fashion with MGE Dec soaring to a contract high of $4.62, replacing the previous mark of $4.46 1/4 set Tuesday.

MGE Dec has now set new contract highs in each of the last seven sessions.

Cargill Investor Services was a featured buyer again, taking about 400 Mar and 500 Dec. Prudential Securities bought a net 200 Dec and sold 100 Mar. ADM Investor Services traded about 250-300 Dec, while Country Hedging bought 200 Dec and sold 350 Dec.

In addition to growing quality concerns for the both the U.S. and Canadian wheat crops, a labor dispute continues to halt movement out of the port of Vancouver, and there is talk of additional worker strikes in other Pacific port locations.

--- Lisa Kallal, OsterDowJones, (312) 341-5780 lkallal@osterdowjones.com "


Shouldn't someone keep track of what the CWB is up to?

I understand we are dwn 50% in Spring Wheat production from the CWB's early August production numbers, what have you heard?

Have you heard the SIXmmt production# for nondurum wheat, and a poor quality SIXmmt at that?

[charliep]

The CWB would not do business direct but would use one of the brokerage houses (could be one of the ones mentioned). None of the major grain companies posts their trades (eg. Cargill Investor Services is a combination of all their trades for clients - not just their parent company).

It should be noted that Canadian millers are also likely hedging in here.

I haven't heard the low production numbers you are indicating - all I know is that every day brings a new challenge (the recent challenge being wet weather).