Wheat futures were firmer.
- Chicago wheat September contract up US5.75c/bu to 527.75;
- Kansas wheat September contract 7.5c/bu to 442.75;
- Minneapolis wheat September contract up 4c/bu to 510.5;
- Corn September contract down 5.5c/bu to 322.75;
- Soybeans August contract down 6.5c/bu to 896.5;
- Winnipeg canola November contract down C$0.60/t to $484.70;
- MATIF wheat September contract up €1.25/t to €183;
- MATIF rapeseed August contract down €1.25/t to €382.25;
- Brent crude September contract up US$1.04 per barrel to $44.32;
- Dow Jones index up 159 points to 26,840;
- AUD firmer at $0.7137;
- CAD firmer at $1.3445;
- EUR firmer at $1.1532.
Currencies reactive to fiscal stimulus bill outcomes
Global currencies are almost all up against the USD after reports that there won’t be a new stimulus bill there until at least next week, with the dollar index off almost a point – the AUD’s firmer at 71.3¢, the CAD $1.345, and the EUR, at $1.153, also helped by the new stimulus bill there. Markets in general believe that US politicians will eventually come together on some sort of new stimulus bill, but with some significant benefits expiring soon the worries about a renewed broader economic slowdown are widespread.
Ukrainian wheat sold to Egypt
The Egyptian buying agency, GASC, tender result last night booked two Ukranian origin wheat boats at a $225-227/t cost and freight, including GASC costings. Lots of Russian wheat was on offer, as expected, but mostly a few bucks over the Ukranian which GASC finally took. GASC often manages to grab a discount cargo or two and it would seem it happened once again.
China strong domestic market
We did get yet another USDA flash sale, with two boats of new season US beans to China, three to unknown, probably China, and 208,000t of unknown corn of mixed seasons, mostly new crop. Markets are also taking note of new sales by China out of domestic reserve stock of rice and wheat. Those sales are aimed at the feed markets, intended to slow down the firm Chinese corn market. Corn there has been very tight so far this summer and many remain bullish. Worries about the flooding situation are also in play for the south, though less relevant in key corn areas.
New season wheat markets were softer across the board yesterday by $3-4/t, while new season barley held mostly unchanged in the $240-245/t range Geelong/Melbourne ($260-65/t delivered Darling Downs). Port zone spreads remained tight for new season while old crop values in SA and Vic continued to ratchet a fraction higher with hand to mouth demand ongoing. Weather forecast maps remain on the drier side into later next week for most of the country, though some moisture is on the forecast for parts of NNSW and the Downs. Mostly great conditions prevail in SA and Vic after recent moisture, but crops will need a top up in a couple weeks. The US representative agricultural office in Australia forecast the wheat crop at 27 million tonnes (Mt), 1Mt higher than the official USDA number. The forecast received some light talk globally and there are some who think the crop potential is above 30Mt. Lachstock does not see this as reasonable at present because crop size will depend on spring weather.
Source: Lachstock Consulting