Article Title

Article Teaser

World durum production dropping to the lowest level in 10 years has fueled a run-up in U.S. and Canadian durum prices in recent months. Aggravating the impact of the small world outturn on world durum supply was the subpar quality of crops harvested in a number of countries, most importantly, Canada. At $9.40 a bu, basis Minneapolis, the price of U.S. choice milling hard amber durum was the highest since $9.50 a bu in January 2009 and compared with the recent low price of $5.15 in June 2010. (It should be noted some market participants suggested the price of choice milling hard amber durum in the United States was even higher, but a dearth of trading on the spot market made it difficult to peg values with precision.) At the equivalent of $10.35 a bu, the Canadian Wheat Board price for milling durum held in storage in Thunder Bay, Ont., was the highest since $10.50 a bu as the C.W.B. quote in November 2008. While historically high, durum prices on both sides of the border remained well below record highs set in February 2008, when U.S. durum was quoted at $26.50 a bu, Minneapolis, and Canadian durum was quoted at the equivalent of $29.95 a bu, Thunder Bay.

The International Grains Council estimated world durum production in 2010-11 at 34.4 million tonnes, down 6.6 million tonnes, or 16%, from 41 million tonnes during the previous year and compared with the recent five-year average of 37.6 million tonnes. The 2010-11 durum outturn was the smallest since the 2001-02 harvest of 31.8 million tonnes. The I.G.C. pointed to the smaller Canadian and North African crops for the drop in production from the previous year. The I.G.C. also noted not only Canada harvested a crop with lower-than-normal quality. Spain’s crop quality was disappointing with most of that nation’s durum expected to be fed to livestock this year.