Markets

Daily Market Wire 18 December 2020

Lachstock Consulting, December 18, 2020
Up we go again – optimism taking the reins across the board as demand ideas hold up and availability worries work back in. Wheat and corn closed more than 1pc firmer, but Winnipeg blew the lights out with a 2pc jump as bean oil spiked.  Macro markets continued to see support on indications of more stimulus, and the US dollar index weakened to 89.7.

.

  • Chicago wheat March contract up US10.25cents per bushel to 608.75c;
  • Kansas wheat March contract up 8.5c/bu to 570c;
  • Minneapolis wheat March contract up 8.25c/bu to 567c;
  • MATIF wheat March contract up €1.50/t to €207.25;
  • Corn March contract up 5.25c/bu to 432.5c;
  • Soybeans March contract up 17.5c/bu to 1205c;
  • Winnipeg canola March contract up C$13.20/t to $608.50;
  • MATIF rapeseed February contract up €1.50/t to €413;
  • Brent crude February up US$0.42 per barrel to $51.50;
  • Dow Jones index up 149 points to 30,304 ;
  • AUD firmer at $0.763;
  • CAD firmer at $1.272;
  • EUR firmer at $1.227.

International

Complaints coming out of Russia about delays in documentation have been spurring some to pencil down exports further for the first half of 2021.  Paperwork delays there are far from uncommon, and bringing back some flashbacks to the last export tax, where unknowns on the ruble levels at settlement added further volatility.

Forecasts for rain in Brazil are definitely optimistic with near-full coverage across the soybean belt, but the bulls are wondering if it will be too little too late to save crops in some areas.  Conditions in Argentina remain dry.

New-crop area decisions in the US are starting to draw attention away from South America and towards next year’s demand. If Chinese demand continues into 2021, it’s a solid squeeze scenario for grains.  Rumours exist of more US boatloads sold overnight to China.

From last week, US export sales sit at 540,000t of wheat, 1.9 million tonnes (Mt) of corn, and 900,000t of soybeans – stronger than expected for row crops.  Chinese buyers were in for some new- crop too, with a soybean panamax sold for 2021-22.  Sorghum sales hit 325,000t, almost all of it to China.

Argentina’s Bolsa de Cereales cut its local wheat estimate by 200,000t to 16.5Mt as harvest moves along there and results do little to bring encouragement.

Cut to Turkish wheat import duties put in place in October were extended again until the end of April, when the local new crop will start to arrive.

Australia

The Aussie dollar strength continues with the weaker USD letting the Aussie push over 76 cents.

Weather maps continue to call for more rain in northern New South Wales into the weekend, and southern Queensland next week; rain so far has been fairly patchy, but good for those that got it.

More weather-damaged crops are coming off in parts of southern NSW as harvest finally wraps up there, but the tonnage is low relative to the size of the crop.

Growers are leaving their lowest-quality grain to be harvested last.

Victoria’s harvest is still plugging along, with northern spots wrapping up, and cereals coming off hard in the south as big yields help fill storage sites quickly.

Grain Central: Get our free daily cropping news straight to your inbox – Click here

HAVE YOUR SAY

Your email address will not be published.

Your comment will not appear until it has been moderated.
Contributions that contravene our Comments Policy will not be published.

Comments

Get Grain Central's news headlines emailed to you -
FREE!