Daily market wire 11 October 2017

Lachstock Consulting, October 11, 2017

Overnight markets:

Mixed for grains and lower for oilseeds.
  • CBOT wheat down 0.75c to 435.25c,
  • Kansas wheat up 0.5c to 431.25c,
  • Corn down 0.25c to 349.25c,
  • Soybeans down 1c to 976.25c,
  • Winnipeg canola down 2$C to 500.1$C,
  • Matif canola down 2.25€ to 364€.,
  • Dow Jones up 69.61 to 22830.68,
  • Crude oil up US$1.41 to $50.99,
  • AUD up to 0.777c,
  • CAD down to 1.251c (AUDCAD 0.973),
  • EUR up to 1.181c (AUDEUR 0.658).


Winter wheat contracts closed either side of unchanged, while spring wheat finished 5 cents lower. Implied volatility in Dec Soft Red Winter wheat contracts went out at 16.29pc. The USDA called winter wheat planting 48pc complete vs. an average of 58pc. Egypt bought 170,000 tonnes of Russian wheat at higher prices than their last tender, which helps to highlight the logistics shortage they are currently experiencing. Hard Red Winter wheat is now getting closer to Russian wheat prices, which should spark some price support from here, given the tendency for the cash-carry trade, now that variable storage rates, or VSRs, are in play to cap storage charges.


Corn trading finished close to unchanged in a very unobtrusive session that featured a 3-cent range. Brazil’s official agricultural forecaster, Conab, had the Brazilian corn crop at 92.2-93.6 million tonnes (Mt) vs. last year’s production figure of 97.8Mt. The market is looking toward Thursday’s USDA report for further direction.


Soybeans finished near unchanged in a lacklustre session. Conab called Brazilian production at 106-108.2Mt, well below last year’s 114Mt figure. Soymeal was up $1 per tonne, while oil was 16 cents lower. China’s return from holidays coincided with a USDA private sale announcement of 131,000t. The US harvest is 36pc complete vs. an average of 43pc.


Canola closed on its lows in a quiet session, featuring a small trading range and low volume. As harvest gets closer to completion, ideas surrounding the size of Canada’s crop are increasing, which is adding some pressure, despite strong near-term demand prospects.


The rain outlook is improving for central and southern Queensland, with 50-100 millimetres forecast in the next eight days in some of the major growing regions. This rainfall will solidify a full sorghum plant, which will place pressure on northern feed markets when it comes off in March. Victoria’s forecast has changed ever so slightly, with northern areas now only expecting 10-15mm. If achieved, this will still be beneficial for crop production.

Source: Lachstock Consulting


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