Markets overnight post-WASDE saw grains slightly firmer and oilseeds continuing cheaper.
- Chicago wheat July contract up US1.5c/bu to 683.75c;
- Kansas wheat July contract up 4.5c/bu to 640.25c;
- Minneapolis wheat July contract up 11.25c/bu to 775.5c;
- MATIF wheat September contract unchanged at €212.50/t;
- Corn July contract up 8.25c/bu to 699c;
- Soybeans July contract down 18.5c/bu to 1544c;
- Winnipeg canola July contract up C$7.80/t to $871.80;
- MATIF rapeseed August contract down €4.75/t to €529.75/t;
- US dollar index unchanged at 90.1;
- AUD firmer at US$0.775;
- CAD firmer at $1.210;
- EUR weaker at $1.217;
- ASX wheat July contract unchanged at $305/t;
- ASX wheat January 2022 down $2.50/t to $307/t.
International
There were reports of widespread flooding across the US Delta.
Very wet in US cotton, rice, sorghum region above the Gulf, contrasting with extreme dryness in the northern Plains stretching to Canada.
President Biden has advised that US has donated half a billion doses of the Pfizer vaccine to the countries that need it most.
USDA released it’s WASDE overnight in which it increased 2021/22 global wheat production by 5.5Mt to 794.44Mt. The wheat crop in Argentina was projected at 20.5Mt, Australia 27Mt, Canada 32Mt, EU was raised 3.5Mt to 137.5Mt, Russia raised 1Mt to 86Mt and Ukraine raised 0.5Mt to 29.5Mt.
Wheat in the US was a little friendly, but the USDA went against the trend and increased Russia production. They also increased EU wheat production. It’s a slightly bearish report in its own right for global wheat
Seems the USDA largely squibbed out on making any adjustments to the 21/22 corn season and was content with taking Brazilian production and exports down a hair and passing that into the old crop US corn S&D. The lack of appetite to change corn will give the market an opinion that USDA wanted to kick it down the curb and will be viewed as bullish.
Old crop beans were higher than expected and that flowed through to new crop, with all new crop figures unchanged. Again, another park and ride S&D from the USDA. Old crop changes will disappoint the market.
It seems the USDA largely squibbed out on making any adjustments to the 21/22 corn season and was content with taking Brazilian production and exports down a hair and passing that into the old crop US corn S&D. The lack of appetite to change corn will give the market an opinion that USDA wanted to kick it down the curb and will be viewed as bullish.
Wheat in the US was a little friendly, but the USDA went against the trend and increased Russia production. They also increased EU wheat production. It’s a slightly bearish report in its own right for global wheat.
Old crop beans were higher than expected and that flowed through to new crop, with all new crop figures unchanged. Again, another park and ride S&D from the USDA. Old crop changes will disappoint the market.
Australia
Weather maps remain positive for the next 10-15 days across southern Australia and the east coast. Total precipitation is predicted to push up around 15-20mm for most regions in the next 15 days. Rainfall through the Riverina was fantastic with 15-25mm range received which puts smiles on growers’ faces. Crops still delayed but the potential is still there on cereals following the latest rain received.
Canola crops were reported under pressure with patchy germination. The latest rain event will struggle to fix that issue.
Markets were a tad softer by the afternoon with the trade not overly keen to participate prior to USDA report. ASX Jan 22 wheat settled down $2.50/t to $307/t and barley down $1/t to $259.50/t.
Source: Lachstock Consulting
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