Daily market wire 22 Nov 2016

Lachstock Consulting, November 22, 2016


Markets rallied in what appeared to be commodity-wide buying led by soybeans.

CBOT Wheat was up 2.25c to 410.25c, Kansas wheat up 0.75c to 414.5c, corn up 4.25c to 349.75c, soybeans up 26.5c to 1020.25c, Winnipeg canola up 6.70$C to 521.2$C, and Matif canola up 2.25€ to 399.75€. The Dow Jones up 88.759 to 18956.69 , Crude Oil up 1.8c to 47.49c, AUD up to 0.737c, CAD down to 1.34173c, (AUDCAD 0.98871) and the was EUR up to 1.0633c (AUDEUR 0.6928).

Soybeans rallied on the back of high Malaysian palm oil pricing which rallied Dalian futures, all in spite of a strong US and Yuan at 8.5 year lows.. Support also evident in beans from slow planting progress in Argentina.

Locally, canola harvest approximately 50% complete in with oil over 46%. Harvest in Vic and Southern NSW looking at delays this week on mild rainfall.

ASX wheat picked up on Monday after last week’s sell off, East coast wheat will see strong support at export parity.

Indian wheat imports looking to increase with market talking 4-5 mmt vs USDA at 3 mmt. Volatility in WZ up 2.5%, with 130k open positions remaining in WZ. Could lead to some fireworks in the spreads from an order flow perspective this close to option expiration.

US winter crop still a concern to shorts with inadequate moisture and a cold snap in the forecast.

Canola rallied on strength in palm oil and the higher oil complex, as well as concerns over Canadian crop delays. Pakistan bought Canola for Jan/Feb.


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