The new month hasn’t brought about a great deal of good news with all commodities losing ground, despite a clear weakness in the US dollar.
The heaviest hit was Winnipeg canola with a loss of almost $C14. Chicago and Kansas wheat both lost less than 2c as corn lost 5c.
That being said, wheat markets seem to be showing a respectable amount of resilience against the current quality issues, the threat of lower acres and the extraordinary global supply.
The fact that the market is already heavily short helped to limit losses.
This is more that can be said for row crops that don’t seem to be handling the pressure with the same level of intent after recent signs of vulnerability are beginning to show.
CBOT Wheat was down -2c to 414.25c, Kansas wheat down -1c to 413.75c, corn down -5c to 357.75c, soybeans down -18c to 984.25c, Winnipeg canola down -$C13.7 to $C503.9, and Matif canola down -€5.75 to €393. The Dow Jones down -105.32 to 18037.1 , Crude Oil down -0.53c to 46.33c, AUD up to 0.7657c, CAD down to 1.3388c, (AUDCAD 1.0251) and the was EUR up to 1.1056c (AUDEUR 0.6921).
In some potentially good news for Australia, India seem to have lost interest in Russian wheat after 11.5% protein wheat was offered to the Indian market on Monday with hardly a nibble. India showed more interest in Ukrainian wheat that was priced $3/mt over Russian.
This may open the door for more Australian business as the risk of importing Russian wheat is increasing due to specific requirements on phytosanitary certificates. Weaker meal basis and crush margins saw soybeans lose ground overnight of nearly 20c.
Canola jumped on board and followed the soy complex lower with some strength in the loonie creating additional headaches.
Contracts in the Winnipeg canola market were well above average at 30,333 contracts compared to 18,655 traded on Monday.
The rainfall forecast over the canola belt in Canada looks to be improving which will provide the opportunity to make some headway into what has been an interrupted harvest.
Domestically, protein in Australian wheat is becoming more sought after as global protein levels are less than impressive in what has been a massive crop in the Northern Hemisphere.
This provides an opportunity for Australian farmers to cash in if everything falls in our favour.
The eight day forecast for Australia is looking relatively dry with no more than 5mm expected to fall in NSW.
- Source: Lachstock Consulting