Overnight futures markets:
Lower for wheat, mostly higher for oilseeds.
- CBOT wheat was down -8c to 420c,
- Kansas wheat down -10.25c to 417.75c,
- corn up 0.75c to 338.25c,
- Soybean up 8.5c to 987.25c,
- Winnipeg Canola up 6.70$C to 526.5$C
- Matif canola unchanged at 377.5€.
- The Dow Jones down -108.25 to 23301.22,
- Crude Oil down -0.43c to 55.27c,
- AUD down to 0.758c,
- CAD up to 1.276c, (AUDCAD 0.968)
- EUR down to 1.179c (AUDEUR 0.643).
Russian wheat bid values have nominally dropped, but offers for 12.5% protein continue to hold up at US$194 FOB.
Egypt’s buying agency GASC announced it would reintroduce strict ergot requirements, which is raising concerns for future demand and what this does to Russian exports. This could be a legitimate threat or a tactic employed to drag down prices in a heavily supplied market.
The Ruble has fallen just over 3 per cent since the beginning of November. This weakness is not supportive of sustained Russian cash pricing and is beginning to play a part in US futures weakness.
US cash markets have been quiet with basis bids dropping slightly on limited volume. This has lowered flat price and could see HRW competitive into Algeria, which may provide some support.
Implied volatility in December Soft Red Winter wheat futures prices went out at 19pc, as open interest continued to grow.
Beans managed a rally despite 65-100mm of rainfall forecast for Brazil in the next two weeks. Soymeal was up US$1.7/t while soy oil was 49 points higher, popping up on lower than expected US stock reserves in the National Oilseed Processors’ Association (NOPA) numbers. NOPA’s crush figures came out at around expectations and were 20pc higher than September figures.
Reports from a major Chinese importer suggested 17/18 bean imports would reach 100Mt, which is well over the current forecasts from USDA and China’s Ag ministry.
Canola found a bid and rocketed back towards recent highs. Strength in bean oil, brought on by lower US oil stocks, should encourage greater local crush demand in the US and increase competition between local and export buyers.
Source: Lachstock Consulting
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