Markets

Daily Market Wire 20 January 2025

Lachstock Consulting January 20, 2025

The day ahead

Weather – Argy has some rain forecast in the next week but as it is nothing of consequence and,  coupled with above average temps, the forecast is providing no more confidence to production.

Markets – Grains and oilseeds markets closed higher on Friday ahead of a 3-day weekend, supported by Argentina weather concerns and cautious optimism on US-China trade relations following reports of a constructive conversation between incoming US President Trump and China’s President Xi on Friday night.

Australian day ahead – AUD made it above 0.6200 but only briefly to drop back to 0.6197. Canola is set to make back some of the Friday’s losses on the back of Matif gains Friday night. Expect little change to cereal markets as traders sit on the sidelines with perhaps a clearer picture on what Donald Trump looks to do over coming days. But then again, perhaps not.

Offshore

President-elect Donald Trump will be inaugurated on Monday, at the same time the US markets will be closed due to Martin Luther King Jr. Day. 

US weekly wheat export sales bounced back following the holiday period, wheat sales for the week of Jan 9 were 513,424t which was well above the trade estimate range of 150kt to 400kt. The top buyer was South Korea with 131.8kt followed by 114.7kt sold to Taiwan.

Pace of Russian wheat export in December and January slackened, but cumulative exports remained close to 2023/24 levels. Source LogisticOS via Lachstock Consulting. Click expand

Argentine soybean crop condition ratings have been sliding, with the excellent conditions down 17% to 32% and the poor conditions up 13% to 21%, according to BAGE. Prospects in Brazil remain positive. Brazilian agribusiness consultancy Agroconsult is the latest forecaster to predict Brazil will harvest well over 170 million tonnes (Mt) of soybeans this season. 

 

The Rosario Grain Exchange lowered its forecast for Argentina’s 24/25 corn production from 50-51Mt to 48Mt. 

The IGC raised its wheat stock estimate by 2Mt to 265Mt, this is still an 8Mt reduction from last year. 

Japan’s MAFF purchased 133,888t milling wheat, in its regular tender, from the US, Canada & Australia. Australia accounted for 28,060t ASW to be loaded 1-30th April. 

Australia

The end of the week saw canola values down $15–$20, with WA bids around $840. WA wheat was off around $5 to $368, with barley a touch firmer to around $330.

Canola bids in the east of the country were off $10–$25, to around $792 and there was a $120 spread to GM. Wheat was largely unchanged last week, with bids around $345 and barley $305.

With Chinese New Year fast approaching (29th Jan), eyes will be on China to see if any significant export business is done prior to the New Year period.

As sorghum harvest continues to ramp up in the north, export business will be closely watched. Good export margins make it likely that wheat will lose its place in the export program. After losing out to chickpeas earlier in the year, wheat carryout looks set to grow in the north.

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