Markets on Friday saw new monthly highs with protein wheat leading the charge.

Much of the week has seen grain markets trading higher mid session only to fade into the close and end with marginal gains.

Continued downgrades continue to roll out of the EU, with the German farm association suggesting their crop is down 13 per cent to 22.9mmt.

On top of the French reductions, this means we have lost over 10mmt on inclement weather in these two countries alone.

Conversely the Russian and Ukrainian crops have covered the deficit with the Russian Ag Minister suggesting their all grain crop could reach as high as 116mmt from current market estimates sub 110mmt.

CBOT Wheat remains at 427c, Kansas wheat down -2.2c to 418c, corn up 2.2c to 334c, soybeans down -5.2c to 1027c, Winnipeg canola up 0.7$C to 469.2$C, and Matif canola up 0.25€ to 378€.

The Dow Jones down -45.13 to 18,552.57 , Crude Oil down -0.22c to 48.3c, AUD down to 0.76198c, CAD up to 1.28803c, (AUDCAD 0.98128) and the was EUR down to 1.13117c (AUDEUR 0.6733).

Global FOB values continue to steadily increase with Russian prices rallying to $15mt since the end of July.

Current offer is $174 vs SRW ex-Gulf at $182 and French at $188.

Bangladesh are upping their wheat purchases out of Russia and the Ukraine after Indian exporters withdraw from the market.

There has been approximately 800,000mt booked for shipment between mid July and October compared to approx 550,000 this time last year.

Updated commitment of traders reports had the speculative funds at 120k contracts short in CBOT and 35k contracts short in KCBOT.

In row crops speculative funds positions were updated for Corn at 139k short and beans at long 94k contracts.

The corn market on Friday night ended up 1.75cbu and beans lost 10cbu.

With the PF crop tour kicking off this week in OH and SD, upside yield estimates will be questioned, and give market bears something to digest during the week.

Commodities surged the most in the first half since the 2008 financial crisis as China’s economy stabilized and policy makers backed growth.

The World Bank forecasts commodities will rebound next year after hitting the bottom of the cycle and Citigroup Inc. agrees, saying last month it’s bullish on raw materials for 2017.

At home, we have seen renewed export interest in Australian wheat, as the quality of the northern hemisphere crop leaves buyers questioning the quality of supply.

The challenge as we move into our harvest will be getting access to the mountains of grain before BHC restrict access in preparation for new crop arrivals.

Australian growers may get one last chance to sell old crop grain held on farm (in quality storage) at a premium to new crop values if this trend persists.

• Source: Lachstock Consulting