Markets

Daily Market Wire 19 February 2019

Lachstock Consulting, February 19, 2019

Monday was Presidents’ Day, a US holiday, and its markets were shut. European futures traded lower.

  • CBOT wheat was closed
  • Kansas wheat was closed
  • Corn was closed,
  • Soybeans market was closed
  • MATIF wheat was unchanged €195.25
  • MATIF corn down 0.4 per cent to €172.25
  • Winnipeg canola was unchanged at C$475.80,
  • MATIF canola was down 0.2pc to €363.25
  • Dow Jones was closed
  • Crude oil up another 0.5pc to $56.27,
  • AUD down to US0.713c,
  • CAD unchanged at US1.32, (AUDCAD 0.94)
  • EUR unchanged at US1.1315 (AUDEUR 0.63).

Wheat

US export data has been disappointing which set the market back in CBOT last week. The lack of data coming out of US due to the shutdown has kept a lot of speculators and traders out of the market. Without any decent demand stories the market is continuing to find it tough to find support. CBOT continues to threaten to price into Indonesia and the global major exporter stocks remain tight. Due to this we can expect to see tightness arise, however the surprisingly resilient global consumer seems to be getting the better of it for now.

Trade policy

Long weekend in the US and congress seem to have avoided another shut-down but President Trump has called a state of emergency to get part of his funding, so the market remains very cautious about where we are headed. Similarly, negotiations with China continue to provide little clarity on the trade situation and as the March 1, 2019 deadline approaches we will once again have more and more uncertainty in the market, which makes it hard to get clear direction based on fundamentals.

Barley flux

Barley in particular remains in a flux with Saudi continuing to sit out of the market. They were expected to come in and tender when China was away on their New Year holiday, but that has since been and gone and we have nothing to show for it. Some other smaller consumers in the market but trade longs remain very nervous and we will now start to focus as much on the results of the China anti-dumping situation. This is likely to drag on as, in part, it is a retaliation to measures imposed on China consumer goods into Australia. Politicians suggesting to the Australian exporters that it will be a slow process. We wait to see how the China beer manufacturer will play this tricky situation.

 

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