Overview of futures markets:
Mixed for grains and oilseeds with limited new fundamental inputs and increased fund buying.
- CBOT Wheat was up 3.25c to 452.25c,
- Kansas wheat up 6.25c to 466.75c,
- corn up 1c to 375.5c,
- soybeans down -4.75c to 1054.25c,
- Winnipeg canola down -3$C to 524.8$C,
- Matif canola up 2.25€ to 424€.
- The Dow Jones up 142.79 to 20412.16 ,
- Crude Oil down -0.979c to 52.88c,
- AUD down to 0.764c,
- CAD down to 1.306c, (AUDCAD 0.998)
- EUR down to 1.059c (AUDEUR 0.721).
Soybeans weaker, along with soy oil whilst meal was stronger. Open interest is increasing in beans as funds build long position, on speculation of increases in future Chinese demand.
Corn closed slightly higher with solid export inspections and new business being concluded. In addition, fund buying continues to provide ongoing support as the technical picture develops further. Large grower selling was witnessed, but fund buying overcame this with open interest increasing.
Wheat closed higher after trading higher and lower with a 12 cent range. Underlying support appears to be a combination of fund buying and short covering. Despite no major bullish fundamentals, fund attitude appears to be buying breaks in wheat at present which is a large shift from the sentiment of selling rallies. Winter kill concerns in the Ukraine are picking up as snow cover is not thought to be adequate, and temps have been extremely cold. Russian prices remain stronger in the front end with limited grower selling and logistical issues. Calendar spreads have settled as the cash markets have softened enough to warrant some deliveries against the March contract.
The rainfall received in WA over the weekend has done severe damage to the CBH up country network which will restrict grain flows to port and should result in force majeure events. Kwinana and Albany zones appear to be the worst affected, the result of this could be positive for pricing in other states as cfr commitments are pushed to different origins, the key issue here will be whether anywhere in the country has surplus shipping capacity to participate in this.
Source: Lachstock Consulting