Markets were lacklustre overnight. Wheat fell despite getting confirmation that China bought 110kt SRW. Most reported this as regular business, suggesting there was nothing unusual about it. MATIF was also heavy, under the weight of an upward Russian wheat crop revision by Russian agricultural consultancy IKAR which pegs Russian winter and spring wheat crop at 91Mt, feeding the world. 

Corn and beans also found month-end selling, dissatisfied by the lack of China buying and a better weather outlook in the US. 

The Argentine wheat crop has had another hard year. The BA grain exchange flagged the likelihood of further cuts as the Pampas growing belt continues to suffer under adverse growing conditions. Parts of the belt have only received 18pc of normal rainfall since the beginning of June. 

India’s monsoon is off to a slow start with some areas only receiving around 40pc of normal rainfall since the start of June. This will become increasingly important given the USDA only has India importing 100kt. While not generally an importer, when India does it imports in style. In 2016/17 India imported 6Mt which, if repeated this year, would clearly move global balances. There have been rumours India has a supply agreement with Russia, but nothing has been confirmed. 

US consumer spending rose 0.6pc in July, a solid result given many were calling a recession a certainty. This does cast a shadow over the possibility of the Fed reversing its rate policy, at least for the moment. 

Australia is on track to export 31.4Mt of wheat this marketing year, a significant upswing from last year’s record of 27.6Mt.

Australia

Local markets were a touch stronger yesterday through new crop wheat bids but it is the same old story, liquidity remains low.  

Current crop stayed largely unchanged although southern delivered bids were hard to come by.  

Barley showed some firmness in WA with FIS bids around A$370/t for new crop. The China export program is in full swing with constant inquiries for shipping ex Australia to China. 

Canola was largely unchanged also along with the pulse market where lentils in the southern regions are still bid around $1000/t. This further supports the ideas that Indian conditions are less than ideal.