Markets

Daily Market Wire 15 June 2021

Lachstock Consulting, June 15, 2021

Futures markets stepped lower on Monday night.

  • Chicago wheat July contract down US6.25c/bu to 674.5c;
  • Kansas wheat July contract down 10c/bu to 628c;
  • Minneapolis wheat July contract down 18.25c/bu to 746.5c;
  • MATIF wheat September contract down €2.25/t to €209/t;
  • Corn July contract down 25.25c/bu to 659.25c;
  • Soybeans July contract down 36.25c/bu to 1472.25c;
  • Winnipeg canola July contract down C$17.30/t to $853.70;
  • MATIF rapeseed August contract down €7/t to €509.75/t;
  • US dollar index unchanged at 90.5;
  • AUD unchanged at US$0.771;
  • CAD firmer at $1.215;
  • EUR firmer at $1.212;
  • ASX wheat July contract down A$0.50 to $305/t;
  • ASX wheat January 2022 down $1/t to $309/t.

International

Chicago wheat fell 6.25usc/bu to settle at 674.50usc/bu, Minni was offered on a wetter forecast, falling 18.25usc/bu while Kansas fell 10usc/bu. Chicago corn dropped 25.25usc/bu to close at 659.25usc/bu, soybeans were off 36.25usc/bu, meal was down USD$9.40/st and oil was down 0.99usc/lb. French canola was down €7/t while Canadian canola was off C$17.30/t.

Weather markets typically trade more on forecast than they trade on reality, and Monday’s trade was no exception. Lower temperatures and above average rainfall forecast for the drier parts of the corn belt and into the spring wheat areas were forecast and so the markets traded lower. However, until this event actually occurs, conditions in the belt will be the complete opposite, with high temperatures and very little precipitation.
The crop condition/progress reports, released after the markets closed today, were generally supportive.
Corn conditions 68pc rated good-to-excellent (G/E) vs. 72pc last week & 71pc last year
Bean conditions 62pc G/E vs. 67pc last week & 72pc last year
Spring wheat conditions at 37pc G/E, vs. 38pc last week and 81pc last year
Barley conditions at 45pc G/E, vs. 43pc last week & 77pc last year
Winter wheat harvested 4pc, vs. 2pc last week & 15pc ave
Winter wheat conditions at 48pc G/E, vs 50pc last week & 50pc last year
Egypt’s GASC tendered after the close, the first since the tax changes in Russia.
Investors’ attention is focused on the FOMC meeting’s conclusion on Wednesday, and what may be stated concerning inflation and a potential change in interest rate hike timetable. Economists believe the so-called dot plot will lead to an increase in interest rates in 2023, although the bank is unlikely to announce a reduction in asset purchases until later this year
Prime Minister Boris Johnson pushed back his plan to lift England’s restrictions for at least another four weeks. Covid cases have been rising rapidly, fuelled by the highly transmissible variant, however the success of the vaccinations against the variants is slowing the rate. On Monday, the British Government reported 7,742 new confirmed cases, one of the highest daily numbers since the end of February. Around 62pc of the British population had received one shot, while about 45pc had two.

Australia

Markets return locally here after the long weekend. We saw wheat markets a touch softer by the end of last week on new crop, while old crop continues to remain supportive as we have seen for the past month now. Barley continues to gain momentum on the old crop with more buying demand for July/August slots. We saw the Friday old crop barley finish the day out $280 bid delivered Geelong/Melbourne.
Eight days ahead look promising on the weather front for SA and Victoria with 10-20mm rain event forecast. This will go a long way on the back of last week’s rainfall that was received.
GIWA released their June 2021 crop area estimate on Friday with above average yields flagged. Total crop area planted in WA is up 5 per cent compared to the 2020 record.

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