Markets

Daily Market Wire 10 March 2020

Lachstock Consulting, March 10, 2020

Crude oil futures doubled down, another 24 per cent lower, oilseeds 1-3pc and grains were mixed.

  • Chicago wheat May contract up US3¢/bu to 518.75¢;
  • Kansas wheat May contract down 5.25c to 441¢;
  • Minneapolis wheat May contract down 4.5¢ to 525.75¢;
  • MATIF wheat May contract down €3.25/t to €178.5/t;
  • Corn May contract down 3.25¢/bu to 372.75¢;
  • Soybeans May contract down 21.25¢/bu to 870¢;
  • Winnipeg canola May contract down C$4.40/t to $455.30/t;
  • MATIF rapeseed May contract down €9.75/t to €368/t;
  • Brent crude May contract down US$10.91 per barrel to $34.36
  • Dow Jones index down 2013 points to 23543;
  • AUD weaker at $0.6590;
  • CAD weaker at $1.368;
  • EUR firmer at $1.145.

Market news

Macro worries continued on all fronts. Markets were down sharply overnight with crude leading the way and continued to sell off into the day in the US.  The DOW closed down 2013 points which will be the biggest day in history so far, and WTI crude is trading just a hair over $30.8 (Brent $34.4) down some 25% from last Friday. Soybeans also took a slash, falling 21 1/4¢ to 870¢, and corn was down 3 1/4¢ to 372 3/4¢.  Wheat saw a little more support during the session with some buying action in Chicago counterbalancing the overall negative flow (closing +3¢ to 518 3/4¢) though KC and Minny were both off (-5 1/4¢ to 441¢, -4.5¢ to 520 3/4¢ respectively) and Matif ended down 3.25€ to 178.5€.  The AUD’s weakened back to 65.9¢, the CAD $1.368, and the EUR firmer to $1.145.

There’s really no clear cut certainty about the fundamental extent of the coranvirus impacts, but as the situation expands outlooks are getting worse and markets are running scared.  The crude oil fight isn’t helping anything. Some are now suggesting it could last well into next year.  In the meantime, ags are basically along for the ride with the money flows moving.

There were two boats of unknown bean sales flashed (124,000t) but at the same time there’s more talk of Brazilian beans trading with rumours of 25-30 boats sold late last week. This continues to underprice US beans, though today’s sell off does help that spread.

WASDE figures will be released tonight and are not expected to bring any significant changes to the US S&Ds.  There’ll be some re-jigging but no real big moves normally are made at this point.

Export inspections were also out in the US, though with the macro moves they were not a priority to most.  All the numbers were on the low end of expectations but no real surprises.  Corn came was 830,000t, including some white corn to Mexico, beans 572,000t, wheat 416,000t, and sorghum 58,000t though not reflecting any of the recent China biz executing.

The USDA’s March World Agricultural Supply and Demand Estimates come out tonight.

Australia

Aussie markets have felt pressure across the board with the macro moves globally. On the upside though it’s provided opportunities for diesel hedges as crude has broken.  WA weather maps remain positive into later in the week, with 10-15mm forecast for the entire wheat belt.

 

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