Markets

Daily Market Wire 13 July 2020

Lachstock Consulting, July 13, 2020

Friday’s markets closed mixed.

  • Chicago wheat September contract up US9c/bu to 534;
  • Kansas wheat September contract down 4.75c/bu to 452;
  • Minneapolis wheat September contract up 0.25c/bu to 526.25;
  • Corn September contract down 11.5c/bu to 337.25;
  • Soybeans September contract down  9.75c/bu to 885.5;
  • Winnipeg canola November contract down C$1.90/t at C$479.50481.40;
  • MATIF wheat September contract down €0.75/t to €187;
  • MATIF rapeseed August contract down €2/t to €383.25;
  • Brent crude September contract down US$0.89 per barrel to $43.24;
  • Dow Jones index up 369 point to 25075;
  • AUD firmer at $0.6967;
  • CAD weaker at $1.3576;
  • EUR firmer at $1.1322.

Chinese buying up big

Flash sales confirmed a massive chunk of Chinese corn purchasing: 1.36 million tonnes (Mt) with 765,000t of that old season.  There was also confirmation of 190,000t of Dark Northern Spring sales, and 130,000t of Hard Red Winter wheat. No Soft Red Winter (SRW) wheat sales have appeared, although some are hoping they will show up this week.  Chinese buying remains far behind levels required to reach trade-deal agreements, but if this type of business continues, that will change.  It seems a Phase 2 trade deal between the US and China is now off the table.
The USDA’s World Agricultural Supply and Demand Estimates report on Friday was mostly as expected, with area and stocks already known from June reports.  Forecast corn and soybean ending stocks were both about as expected, as was wheat with the exception of SRW which was down a little. Global figures were mostly glossed over by the trade, and included a cut to the Russian wheat crop to take it to 76.5Mt, and EU was revised down by 1.5 Mt, with neither outside the realm of expectations.
Improved weather forecasts for the corn belt didn’t help row crops, with better chances for rain in parts of the corn belt.  Weekend updates have predicted less rain, and a significant area still in need of moisture, with hot weather on the way.  Crop progress figures will have updated conditions out tomorrow, but the excitement is all about the coming weak of weather and the potential for yield to start dropping.

Australia

Aussie markets continued to firm on Friday, picking up another $2-3/t on new crop, and showing continued firm old-crop demand on the east coast.  Recent rains have been much appreciated and have helped to fill in some of the drier areas, but more is needed.
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