Daily Market Wire 17 September 2018

Lachstock Consulting, September 17, 2018

Higher for grains and mixed for oilseeds.

  • CBOT wheat up 12.5c to 530.25c,
  • Kansas wheat up 14.25c to 537c
  • Corn up 1c to 363.75c
  • Soybeans down -2.75c to 844.25c,
  • Winnipeg canola up 1$C to 490.9$C, and
  • Matif canola up 1.75€ to 370€.
  • The Dow Jones up 8.67 to 26154.67,
  • Crude Oil down -0.14c to $US68.84 per barrel,
  • AUD up to 0.715c,
  • CAD up to 1.304c, (AUDCAD 0.932) and the
  • EUR up to 1.162c (AUDEUR 0.614).


Demand encouraged a rally in wheat with Middle Eastern consumers recognising value. Saudi is expected to price some export business as Canada is unable to participate and Australia and Europe are tight. Implied volatility in Dec SRW finished at 24.15pc. European wheat futures were up €1/t to €197.75/t, while Black Sea fob values were left bid at US$240.50/t. The weekly Commitment of Traders Report (COT) had SRW -29.8k to -24.3k contracts and HRW -8.8k to -29.1k contracts. Australia’s production will be a major focus this week, with deteriorating conditions likely to challenge current production estimates.


Corn finished fractions higher gaining some support from wheat price action in a low range session. Last week’s huge USDA yield has added weight to corn, but sellers are not aggressive given current fund position and close proximity to global demand. COT had funds -4k contracts to -86.5 k contracts.


Beans fractions lower with follow through selling from last week’s record US yields as well as new developments on the trade tension front. The Trump government announced new tariff potential with China, while US ethanol producers are talking about production cuts due to declining margins. Soymeal was down $6.60/t and soy oil was 3 points lower. The COT had funds selling 11.8 k contracts at -123.4k contracts.


Canola finished fractions higher across both contracts, with futures rallying in spite of tightening biofuel margins, thanks to ongoing production concerns in both regions.


Aussie cash markets were higher as crop conditions continued to worsen. Production figures are getting dialled back as we have had no significant moisture as well increasing temps, winds and frost issues in WA. Central and southern parts of WA experienced bad frosts over the weekend and should do some damage to quality and yields. Australia could be the catalyst for a CBOT rally this week, depending on how much attention the global market wants to give it.



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