Higher for grains and oilseeds.
- CBOT wheat up 1.25c to 443.25c,
- Kansas wheat up 2.5c to 444.25c,
- Corn steady at 351.5c,
- Soybeans up 10c to 960.5c,
- Winnipeg canola up 2.5$C to 493.8$C,
- Matif canola up 2.5€ to 366€,
- Dow Jones up 39.31 to 22158.18,
- Crude oil up US$1.11 to $49.34,
- AUD down to 0.798c,
- CAD up to 1.218c (AUDCAD 0.972),
- EUR down to 1.188c (AUDEUR 0.671).
Flood concerns in Brazil and Argentina, combined with ongoing export interest, helped beans put the impact of yesterday’s yield news behind them. Given the dryness experienced in August, the market is not convinced record pod weights are accurate . Mexico purchased 167,3oo tonnes and China is rumoured to have been an active buyer on the price break yesterday. Strength came from meal, which was up $5.20 per tonne; oil was slightly lower.
Canola closer stronger, following strength in soybeans, and despite a stronger dollar. Chinese buying interest is helping to stem the order-flow issues in Canada, and the market is now thinking further ahead. Australia is set to have its smallest crop since 2010 and the global balance sheet is looking tight enough to ration crush demand at some point to avoid supply shortages.
Still nothing impressive from a moisture perspective from Australia. There is potential for some isolated frost events, which will sap moisture and damage yields further, in northern NSW on Thursday night. Cash prices continue to strengthen as the market adjusts basis premiums in accordance with revised crop figures. The wheat market is powering ahead faster than barley, which provides an opportunity given that barley’s relative value to wheat is expected to contract and potentially invert next year due to the strong reliance the global balance sheet has on Australian barley.
Source: Lachstock Consulting
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