Daily market wire 18 August 2017

Lachstock Consulting, August 18, 2017

Overnight markets:

Lower for grains, mixed for oilseeds.

  •  CBOT wheat down -6.25c to 440.75c,
  • Kansas wheat down -5c to 442c,
  • Corn down -2.25c to 364.25c,
  • Soybean up 7.75c to 933c,
  • Winnipeg Canola up 7.19$C to 504.5$C,
  • Matif canola up 1.25€ to 367.5€.
  • The Dow Jones down -274.13 to 21750.73,
  • Crude Oil up 0.21c to 46.99c,
  • AUD down to 0.788c,
  • CAD up to 1.267c, (AUDCAD 0.999)
  • EUR down to 1.172c (AUDEUR 0.672).


Strength from spring wheat, pulled SRW and HRW higher earlier in the session, before the reality of global cash prices sank in, dragging both contracts lower, with funds noted as major sellers. Matif futures continue to make new lows as harvest pressure there and in the Black Sea proceeds. The Saudi government buying agency announced a tender for 490,000t of mid-protein wheat for Oct-Dec shipment. Speculation is rife on which origin will get this business, with freight cheaper since the last tender and stocks that need to move in Russia, the US and Europe.


Corn continued to grind lower as long liquidation continues. The Dec contract is now US$ 5 cents/bushel off the lows reached last September, which should provide some pricing support. Though a close through here suggests a further US$30 c/bu downside. The fundamentals remain very heavy for corn, but the market might struggle to uncover anymore bearish news in the near term.


The bean market was supported today by better than expected export sales and a stronger oilseed complex. Chinese buying and enquiry continues for US beans, which, combined with a drier weather forecast to help set some support levels.


Canola posted a very strong gain, getting back to the Can$500/t level in the Nov contract. Canola production risk has been set-aside recently with limited volumes trading, leaving it a passenger to other market news. Today reflected some risk premium now being put back into the Canadian crop, with early harvest less than two weeks away, with a wide variety in production estimates. Oilseeds complex strength and a weaker dollar provided the initial strength, but increased risk premium kept it going.


The Aussie forecast is quite similar to yesterday’s with 10-15 mm forecast for Victoria and dry everywhere else. Temperatures this week in Southern Queensland have been very hot and the rain that was forecast for NSW didn’t do anything north of Wagga. This will push northern domestic markets higher, which are already pricing to draw southern grains. Cash markets have been fairly quiet with the lower futures and limited export enquiry.

Source: Lachstock Consulting


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