Markets rallied.

• Chicago wheat December contract up US18.75 cents per bushel to 575c;
• Kansas wheat December contract up 16.75c/bu to 504.25c;
• Minneapolis wheat December contract up 9.75c at 551.25c;
• MATIF wheat December contract up €2.75 per tonne to €194.50;
• Corn December contract up 2.75c/bu to 378.5c;
• Soybeans November contract up 15c/bu to 1043.5c;
• Winnipeg canola November down C$0.60 to $531.30;
• MATIF rapeseed November contract up €2.50/t to €395;
• Brent crude November contract down US$0.30 per barrel to $43.15;
• Dow Jones index down 245 points to 27,657;
• AUD unchanged at $0.732;
• CAD weaker at $1.318;
• EUR firmer at $1.186.

Markets:

• Boom. Global wheat markets decided Thursday’s close was way too cheap. Russian cash lead the way with an impressive USD$8/t rally – mixed drivers, a combination of very dry winter crop planting conditions and some reluctance by the grower to let their old crop go.
• Much of the support leading into this board rally was built around the risk of a large China wheat purchase. While that risk remains, the rally has been driven by Russia and a cash market that seems at odds with production. Adding to this are the poor planting conditions for the next winter crop.
• This rally will reallocate some of the global supply. Baltic wheat would now compete ahead of Russian into Egypt and, even with poor conditions, Argentina would be winning back market share.
• Australian export prospects will certainly get a leg up as well – Indonesia still has wheat to buy and if it has been waiting for prices to react to a big Russian and Australian crop it would have been disappointed.
• On the doorstep of what could be a large Australian harvest, grower returns look a little more robust than they did. Grower bids are around $20/t from the lows posted back in August.

Australia:

• New crop wheat markets finished the week stronger by $4-5/t across the board. WA new crop grower bids continued to rally and we also saw ASX Jan trade higher on Friday then started to peel back off by a buck or 2 with sellers coming to the table.
• Old crop wheat still remains lacklustre with small liquidity going through in Victoria
• New crop canola markets kept their strength finishing the week up $10-12/t week-on-week.
• Weekend rainfall was patchy through SA, however the Mallee region received upwards of 15mm. Central West NSW also received some really good falls.
• Forecast for the week remains positive for the SA South East and Victoria Wimmera and Western Districts region with 10-15mm still forecast