Markets

Daily Market Wire 19 July 2021

Lachstock Consulting, July 19, 2021

Friday’s markets firmed; wheat lifted at least 2pc.

  • Chicago wheat September contract up US20.5c/bu to 692.5c;
  • Kansas wheat September contract up 11.25c/bu to 651.5c;
  • Minneapolis wheat September contract up 23.25c/bu to 917.25c;
  • MATIF wheat September contract up €5.50/t to €214.25/t;
  • Corn September contract was up 8.25c/bu to 556c;
  • Soybeans September contract up 11.75c/bu to 1406c;
  • Winnipeg canola November contract was up C$5.40/t to $917.50;
  • MATIF rapeseed August contract down €0.50/t to €547.50/t;
  • US dollar index up 0.1 to 92.7;
  • AUD weaker at US$0.738;
  • CAD weaker at $1.263;
  • EUR weaker at $1.180;
  • ASX wheat July contract unchanged at A$300/t;
  • ASX wheat January 2022 up $2/t to $308/t.

International

Wheat markets continued to trade up through Friday’s session with Chicago closing +20.5¢, KC +11 1/4¢, Minny +23 1/4¢, and Matif +5.5€. Corn gave up 8 1/4¢ and beans were up 11 3/4¢ (Matif -0.5€, Winnipeg +$5.4).  Macro markets saw the DOW weaker by 300 points and crude up fifteen cents to $71.8 WTI / $73.6 Brent.  The AUD has continued weakening slightly to 74.0¢, the CAD $1.261, and the EUR $1.181.

The ongoing debate about inflation looks to bring no near-term resolution, but markets remain concerned about the increases to expense budgets that some companies are starting to factor in.  Comments from Bloomberg over the weekend indicated that some 7/8ths of earnings calls in the last month included some discussion of inflation.

A flash export sale of 134,000t of new crop SRW to China was reported in the US on Friday. US Corn Belt weather is forecast hotter and drier. A few showers are forecast for the eastern states but otherwise dry this week.

Likewise, no rain for the majority of the Canadian wheat belt, not that it matters much at this point for many of the crops are already past recovery. The week is beginning with a new heatwave moving in.

France’s Ag Ministry rated wheat crop condition 76 per cent (pc) good-to-excellent, down 3pc from prior and harvest progress at 4pc completed.

Tonight’s USDA US crop progress report will be the first update this year for spring wheat harvest progress. Very little has been cut already but crops are reported to be burning up rapidly in some earlier planted areas and are looking at being harvest ready 2-3 weeks ahead of schedule.  Early yield reports generally have been dismal, as expected, and there are more reports of extremely low test weight in early cuttings.

Argentina has passed new laws reducing the blend of biodiesel in their fuels from 10pc prior, to 5pc now, and potentially lower in the future.

The CFTC Commitment of Traders report on Friday, based on data of Tuesday 13 July, had managed money some 10,000 contracts shorter on Chicago wheat compared with previous week. Note that the snapshot, taken on a Tuesday, occurred prior to the mid-week rally. Likewise, corn and beans.

African Swine Fever is making headlines again, small-scale culling occurring in Germany.

Australia

Weather maps have the storm for WA expanding further inland, although pulling back slightly some forecasts for coastal areas. Rainfall in the approx. 20 mm range is forecast for most of the wheat belt.  Rains received so far have been generally light but widespread and gentle.

 

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