Markets

Daily Market Wire 20 December 2019

Lachstock Consulting, December 20, 2019

Markets closed mixed overnight.

  • Chicago wheat March contract down 3 cents per bushel to 545.25c;
  • Kansas wheat March contract down 1.75 cents to 460.5c;
  • Minneapolis wheat March contract up 2.75c/bu to 541.25c;
  • MATIF wheat March contract up €0.75 to €186/t;
  • Corn March contract down 0.5c to 386.5c;
  • Soybeans January contract down 4c/bu to 924.5c;
  • Winnipeg canola January contract up C$1.30/t to $466.90/t;
  • Winnipeg canola March contract up C$2.30/t to $477.10/t;
  • MATIF rapeseed February contract up €1.75/t to €407.75/t;
  • Brent crude February contract up US$0.37 to $66.54 per barrel;
  • Dow Jones index up 138 points to 28384 points;
  • AUD stronger at $0.6890;
  • CAD weaker at $1.313;
  • EUR stronger at $1.113.

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Markets continued to slip lower through Thursday in the US as the trade looks towards the coming holidays, with Chicago wheat closing down 3¢ to 545 1/4¢, KC -1 3/4¢ to 460.5¢, Minny +2 3/4¢ to 541.25¢, and Matif up 3/4€ to 186€ on the earlier close.  Corn ended -0.5¢ to 386.5¢, beans -4¢ to 924.5¢, and Matif rapeseed +1.75€ to 409.75€ (Winnipeg +$1.3 to $466.9 Jan).  Crude oil is around $61.2 WTI / $66.5 Brent, and the DOW ended up 138 points.  The AUD is trading around 68.9¢, the CAD $1.313, and the EUR $1.113.

There was more talk about Chinese bean cargoes being purchased. As noted the other day these are apparently getting tariff free status, but this time we saw some flashes indicating two boats had been purchased.

In the meantime, comments from China the other day are indicating that no formal details on a proposed trade deal will be made public until it is signed.

Comments from the US side though indicate that the much-discussed agricultural purchases may be more towards next year and that the number is far from a firm commitment and may be reduced depending on conditions.  Not exactly what the ag industry wanted to hear.

Export sales were more positive.  They were near the top end of expectations, with 1.4 million tonnes (Mt) of beans including 553,600t of new Chinese business, not switched from unknown, and two new “unknown” boats, 1.7 Mt of corn and 870,000Mt of wheat.

On the bear side again, there was no surprise in Chinese wheat purchases; the idea had been bandied around in the market for a few days now as one method to reach reported trade deal commitments.

We also saw the Environmental Protection Agency finalise an earlier proposal to re-allocate ethanol mandate waivers.  Final reallocation rules to offset small refinery waivers are offering little support to the ethanol industry, with only a portion of the actual waivers being reallocated.

Australia

Back locally, total fire bans have been declared for the whole of South Australia and Victoria as temps continue to heat up well into the 40s, bringing another day without any harvest.

Some of the Wimmera did get into the field yesterday though, with canola starting to wrap up in western Victoria.  Aussie markets are set to finish the week higher yet again, with majority of markets being up $5-8/t across the south, and a fraction more in some zones.

Northern markets also continue to firm on the back of feed demand and the ongoing poor outlook for sorghum.

The BOM is still calling for good rains into parts of NNSW, but very little into cropping areas.

Fingers crossed that the New Year bring some improvement.

Please note that Lachstock offices will be closed for Christmas, Boxing Day, and New Year’s Day and any responses during the holiday window may see some delays.

 

 

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