Markets

Daily market wire 10 Feb 2017

Lachstock Consulting, February 10, 2017

lackstock1

Overview of futures markets:

Mixed for grains and oilseeds after the USDA report, which published lower than expected stock numbers for wheat, corn and soybeans.

  • CBOT Wheat was up 11c to 443.5c,
  • Kansas wheat up 9.25c to 451.25c,
  • corn down -1.25c to 369.5c,
  • soybeans down -8.25c to 1050.5c,
  • Winnipeg canola up 3.10$C to 527.1$C,
  • Matif canola down -0.75€ to 418.5€.
  • The Dow Jones up 118.06 to 20172.4 ,
  • Crude Oil up 0.769c to 53.11c,
  • AUD down to 0.7625c,
  • CAD up to 1.3146c, (AUDCAD 1.002)
  • EUR down to 1.065c (AUDEUR 0.7154).

Soybeans and canola

Soybeans futures were lower despite a 2Mt drop in carryout. Weekly exports were 113,700t below market expectations. Brazilian government agency CONAB increased Brazilian bean production by 1.8Mt to 105.6Mt.

Canola was stronger despite general oilseed complex weakness. Lower stock figures encouraged futures to close above recent highs and now look poised to test key resistance levels.

Corn

Corn was slightly lower in fairly quiet trade, with the USDA leaving SAM production unchanged.

Wheat

The real story today came in wheat where carryout was down 4.7Mt to 248.61Mt. The key driver was a reduction in Indian stocks which dropped 3Mt to 87Mt.  Market was able to paint a bullish scenario in wheat considering new crop acreage cuts and depleting global stocks.  The short position in Chicago another positive factor which helped wheat close at new highs.

Australia

It remains wet in the west and dry in the East.  Western Australia received between 10-25mm of rainfall in key growing regions in the last 24 hours, with another 25-100mm forecast in the next 4 days.  Eastern Australia is experiencing a heatwave which has been described as “horrifying” by climate researchers. The next 3 days is set to see records tested with little reprieve offered in the near term.  The sorghum crop is getting smaller by the day and the northern markets are responding accordingly. Whilst it is early days, this kind of weather reduces confidence in new crop potential and should see more resistant old crop sellers.

Source: Lachstock Consulting

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