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Durum prices stabilize as demand remains strong

Durum prices may be a little lower than producers would like to see, but they have stabilized due in part to fairly strong domestic and export demand.

durum pasta


“Local cash durum prices have pretty much stabilized in the $4-$4.60 range with an average of about $4.30,” said Erica Olson, marketing specialist for the North Dakota Wheat Commission, adding that domestic demand has remained fairly strong in the past few weeks.new balance 410

“Pasta manufacturers have been seeing good demand for their product, and they're still making fairly good margins because of the lower prices,” she said. “However, some reports do indicate that we're starting to see a slight slowdown in pasta demand.”

Olson noted that most pasta makers have had no problem filling their semolina needs.
 

“It's estimated they have about 75 percent of their January through March needs filled,” she said.new balance 410

Export demand continues to be strong as well of late.
 

“The export pace continues to be stronger than normal,” Olson said. “We've sold about 31 million bushels of U.S. durum so far and that compares to only 11.5 million bushels last year.”

For this marketing year average weekly sales have been around 1.3 million bushels which is nearly five times higher than last year at this time, according to Olson.

The biggest chunk of those sales have been going to Italy, Algeria and Morocco.

Export sales could be impacted soon with the anticipated closing of the Great Lakes port for the winter season.

“Currently the Gulf (of Mexico) port is fairly booked with corn and soybeans, so we could start to see export sales and export shipments begin to drop off which is normal for this time of year,” Olson said. “We usually start to see it pick up again in the spring when the Lakes' port opens.”

So while the lower durum prices have been beneficial for buyers, it's beginning to raise the question of how many acres could be lost in spring planting due to the low prices.

Olson said it's not an issue that is singular to just the United States as many other durum producing countries are facing a similar situation.

“It's not an issue we're dealing with only here in the U.S.,” she said. “In Italy, for example, there are estimates of anywhere from a 15-20 percent decline in durum acreage.

“In the U.S. it's fairly questionable what durum acres will do; however, right now prices are below hard red spring wheat prices, which is concerning.”

Olson said there are other concerns around the world the market is keeping a close watch on as well.

She noted that dry conditions in Morocco and western Algeria are concerning because those countries will soon start to plant their winter crop.

“Right now there are some uncertainties for durum production in some of the major durum producing countries for next year,” she said. “And since there are fewer countries that actually produce durum, that could change the supply situation quite quickly.”

Source: www.farmandranchguide.com

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