Markets

Daily Market Wire 12 November 2021

Lachstock Consulting, November 12, 2021

Markets continue firming.

    • Chicago wheat December contract up US9.5c/bu to 812.5c/bu;
    • Kansas wheat December contract up 10.5c/bu to 828c/bu;
    • Minneapolis wheat December up 7c/bu to 1053.25c/bu;
    • MATIF wheat December contract up €2.25/t to €297/t;
    • Corn December contract up 0.25c/bu to 569.5c/bu;
    • Soybeans January contract up 4.75c/bu to 1221.5c/bu
    • Winnipeg canola January 2022 contract up C$15/t to $1004.40/t;
    • MATIF rapeseed February 2022 contract unchanged at €704.25/t;
    • US dollar index was up 0.3 to 95.2;
    • AUD weaker at US$0.728;
    • CAD weaker at $1.259;
    • EUR weaker at $1.144;
    • ASX wheat January 2022 up A$6/t to $374/t;
    • ASX wheat January 2023 up $7/t to $377/t.

     

International

Chicago wheat was, at one point during the session, 21.75usc/bu higher but still managed to close 9.5usc/bu in the black. Minni wheat put on 7usc/bu while Kansas wheat increased 10.5usc/bu. Corn has been playing catchup since the report but only managed to add 0.25 usc/bu to close at 569.5usc/bu after being 9.25usc/bu higher early in the day. French wheat was up EUR$2.25/t while black sea wheat was quoted US$0.25/t higher. Soybeans put on 4.75usc.bu while meal added US$1.90/st. Bean oil was unchanged, Matif canola was mixed, unchanged in the Feb-22, up half per cent in the May-22 contract and down half per cent in the Nov-22 contract.

The fallout from the Russian Ag minister’s indication that the export tax could be increased continued in the global ag markets yesterday. Hot on the heels of a largely bullish USDA WASDE report, global traders decided most of the major wheat contracts were undervalued.

Brazil approved the sale of an Argentine-developed drought-tolerant GMO wheat strain.

The UN released a report indicating developing nations will feel the brunt of increased import costs for food. Food import costs will increase 11pc for developed countries but a staggering 20pc for developing nations. While freight has accounted for a large portion of this increase it was also noted that increased farm input prices, such as fertiliser, will continue to drive costs higher.

Cotton futures have marched higher amid tightening supplies and increased shipping costs. ICE futures inventories in the US fell by 6pc on Wednesday, not helped by continued harvest delays due to adverse weather

Agriculture has been well supported over the last month with wheat and cotton hitting highs not seen since the mid to early 2000s. However, when looking at the relative performance vs energy and equities the performance looks a little muted. Crude and ethanol have clearly outperformed with crude starting the year at US$48/bbl to close last night at US$81.60/bbl.

Australia

Aussie grain markets yet again continued higher.

Grower cash bids were up $4-5/t, wheat trade markets by 5-6/t. With harvest delays and uncertainty around quality little liquidity is coming to the table. ASX eastern wheat futures contracts were active again with the demand to secure milling wheat contracts.

Barley bids were again a touch stronger. Prompt demand is still popping up in the market for November/December vessel and domestic demand to fill holes as the stop start harvest continues.

More rain! Falls continued along the east coast and in South Australia yesterday with rainfall ranging from 10-40mm in areas. This will yet again keep the harvest at a standstill for a large part of the eastern and South Australia, while WA gets a run on harvest and a clear run into the weekend.

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