Markets

Daily Market Wire 12 October 2020

Lachstock Consulting, October 12, 2020

Most markets firmed after WASDE.

  • Chicago wheat December contract down US1.5 cents per bushel to 593.75c;
  • Kansas wheat December contract up 6.75c/bu to 535.5c;
  • Minneapolis wheat December contract up 1.25c/bu to 543.75c;
  • MATIF wheat December contract up €1.25 per tonne to €200.25;
  • Corn December contract up 8c/bu to 395c;
  • Soybeans November contract up 15.5c/bu 1065.5c;
  • Winnipeg canola November up C$4.50/t to $527.30;
  • MATIF rapeseed November contract up €3.25/t to €393.75;
  • Brent crude November contract down US$.049 per barrel to $42.85;
  • Dow Jones index up 161 points to 28,587;
  • AUD firmer at $0.723;
  • CAD firmer at $1.313;
  • EUR firmer at $1.182.

International

  • Friday’s WASDE report saw bean ending stock projection reduced to 290 million bushels (Mbu) compared with ideas in the mid 300Mbu range. Corn stock was projected at 2.17 billion bushels, nominally higher than expected, and all wheat was as expected at 883Mbu.  Row crop yields were only lightly touched, with corn down a tenth of a bushel to 178.4 bu/ac and beans unchanged at 51.9 bu/ac but corn acres were cut by 1 million to 90.9 and beans by 700,000 to 83.1 million acres.
  • Markets also saw updated Farm Service Agency acreage figures, which Prevent Plant acres up to 10.2 million. Changes to this data have slowed down as the dataset nears completion.
  • Fund positions from the weekly Commitment of Traders  (COT) report confirmed large increases in fund length with corn positions up 27k, beans +9k (record for this part of the season).  Chicago wheat was +18k and KC +9k.  As always these are delayed and do not reflect trade from the second half of the week.
  • Weather maps remain very dry for Black Sea region winter wheat areas and there’s next to nothing forecast all the way through the two week outlooks.  Concerns have continued to build about the expanding drought there and each continued dry run is increasing the worries.
  • Weather maps are also not optimistic for US Hard Red Winter wheat areas, with almost all the hurricane rainfall concentrated east of the Mississippi River.
  • Algeria’s OAIC is reportedly back tendering for wheat again and with updated specs that de-facto open the door to more Russian wheat and risks cutting into EU wheat demand.

Australia

  • Softer tone to finish the week with bids pulling back a few dollars on Friday. Focus is quickly shifting to grade spread management as the BOM long range forecast is making some growers less confident of a clean run at harvest
  • Frosts in PLO a few weeks ago have started to show damage with reports of localised damage of up to 50pct.

It’s a US public holiday on Monday, Columbus Day.

While futures trading hours are not impacted, USDA reports, such as the the US crop progress report, will be delayed until Tuesday.

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