Markets

Daily Market Wire 7 December 2021

Lachstock Consulting, December 7, 2021

Wheat firmed a little, as most markets contained overnight moves to less than half per cent upward or downward. The Dow lifted 2pc.

  • Chicago wheat March contract up US2.5 cents per bushel to 806.25c/bu;
  • Kansas wheat March contract down 1.75c/bu to 822.5c/bu;
  • Minneapolis wheat March up 7c/bu to 1027.75c/bu;
  • MATIF wheat March contract up €1.75/t to €291.75/t;
  • Corn March contract down 0.5c/bu to 583.5c/bu;
  • Soybeans January contract down 5.75c/bu to 1261.5c/bu
  • Winnipeg canola January 2022 contract up C$0.20/t to $1027.10/t;
  • MATIF rapeseed February 2022 contract down €2.75/t to €680/t;
  • Dow Jones industrial average was up 2pc;
  • US dollar index was up 0.3 to 96.3;
  • AUD firmer at US$0.704;
  • CAD firmer at $1.277;
  • EUR weaker at $1.128;
  • ASX wheat January 2022 down A$5/t to $415/t;
  • ASX wheat January 2023 down $1/t to $393/t.

International

Consolidation – CME wheat rose 2.5usc/bu, Minni firmed 7usc/bu while Kansas eased 1.75c/bu. Matif wheat firmed €1.75/t, Black Sea eased USD$2/t while ASX wheat settled down A$5/t at $415/t. Corn snuck higher by 0.25usc/bu, soybeans eased by 5.75usc/bu, meal dropped USD$5.10/st while beanoil firmed by 0.69usc/lb. Canola was quiet, Matif eased €2.75 while Winnipeg firmer C$0.20/t. The Aussie poked back above 0.7000, the Dow got back to buying mode, adding 646.95 points while crude also edged USD$3.68/bbl higher.

China buying has been the common catchphrase in most rallies over the last few years, be they corn or beans, but without China stepping in this time it has been hard for these markets to sustain higher values. With the US govt announcing a diplomatic boycott of the winter Olympics it would be hard to see there would not be some ramification for global commodity markets. Citing “crimes against humanity” the US will still allow athletes to attend but will keep Biden officials at home. The Chinese Foreign Ministry spokesman Zhao Lijian said Monday “If the US is insistent on going down the wrong path, China will take necessary and resolute countermeasures.”

Saudi bought a bunch of hard wheat for July arrival – the US$365.14/t CNF price equates to an east coast Australian price of A$415-420/t for APW wheat.

Though the Brazilian government decision to set its biodiesel mandate level at B10 caught a couple of people off guard (a small crowd was expecting B13), the fact they set the mandate for the full calendar year 2022, rather than just for the first few months, was a surprise to all.

The Omicron variant is now found in 40 countries and at least 16 states in the U.S. The Center for Disease control (CDC) said the agency is “following them closely” and that the number is “likely to rise.” The main concern right now, according to CDC, is the dominant Delta variant in the US and the thousands of cases being diagnosed each day. “We have about 90 to 100k cases a day right now in the United States, and 99.9% of them are the delta variant,” a CDC spokeswoman said.

The Baltic Exchange dry bulk sea freight index rose to fresh month-highs, driven by pretty much all vessel classes. China iron ore import has shown signs of life with hopes a monetary policy easing could limit the downside.

Australia

Markets kicked off the week a fraction firmer on the cash boards for wheat. Barley was mixed across the grower boards with bids in WA up $5/t, SA down $5/t and east coast markets were a touch stronger with some prompt buying interest popping up. Trade markets across wheat and barley where left wide bid offer spread for the day.

Canola markets gained more ground with east coast bids up $5-10/t over the day, which attracted grower selling activity as canola harvest powered along through Victoria. Yields have been above growers’ expectations and growers are willing to sell at current prices.

It is a cooler start to the day through SA and Vic this morning and harvest today will get going later. Clear weather remains for WA, SA and most of Victoria, while NSW is set for another front to hit later today and continue to hang around for the balance of the week.

 

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