Markets

Daily Market Wire 22 October 2020

Lachstock Consulting, October 22, 2020

Wheat markets began the day strongly then retreated, profit-taking bringing pressure near the close.

  • Chicago wheat December contract down US2.25 cents per bushel to 629.75c;
  • Kansas wheat December contract down 1.25c/bu to 569.75c;
  • Minneapolis wheat December contract up 4.75c/bu to 582.5c;
  • MATIF wheat December contract unchanged at €211.25;
  • Corn December contract up 5c/bu to 413.75c;
  • Soybeans November contract up 8c/bu to 1072c;
  • Winnipeg canola November up C$10.70/t to $548.70;
  • MATIF rapeseed February contract up €4.75/t to €398;
  • Brent crude November contract down US$1.43 per barrel to $41.73;
  • Dow Jones index down 98 points to 28,211;
  • AUD firmer at $0.711;
  • CAD weaker at $1.316;
  • EUR firmer at $1.185.

Chicago ended down  2 1/4¢ to 629 3/4¢, KC -1.25¢ to 569 3/4¢, Minny +4 3/4¢ to 582.50¢, and Matif settling unchanged.  Corn was up a nickle to 413 3/4¢ while beans ended up 8¢ (Winnipeg +$7.1 Jan to $548.8 and firmer on the Nov as expiry approaches, Matif +4.75€ to 398€ on the Feb).

International

  • Rains in South America are still heavy on the maps and recent totals and extended runs are turning dry again for southern Brazilian bean areas. Some in the market remain concerned about crop impacts
  • US weather maps remain dry for the western HRW areas, although with the combination of recent moisture and rapid harvest progress there are is some further interest in eastern cornbelt SRW region where some area can double crop with late beans.
  • Russian weather maps are as dry as a pub with no beer – the last runs on the GFS are almost entirely blank across the two-weeks outlooks for winter wheat areas
  • Algerian tender results for wheat still to come out, watch this space as the EU wakes up.
  • Turkey’s removed import tariffs on wheat, corn and barley in a bid to keep down local food prices. The crash in the value of its currency, the lira, isn’t helping matters.  Turkey regularly imports wheat and exports flour, with taxes rebated, but the cuts will help pressure local prices until the new crop harvest in May.
  • Cash markets in the Black Sea region reportedly lifted a few dollars following the Turkish announcement, mostly on the coaster-sized vessel bids.
  • US weekly ethanol production was down 24,000 barrels per day to 913,000 and stocks dropped back under 20 million barrels.

US stimulus, COVID unease

No progress appears to have been made on the next US stimulus Bill despite PR releases from both sides. Talks are continuing. Coronavirus-related economic concerns are front and centre globally and renewed focus on the spike in cases in the EU, which picked up rapidly in the last month, has contributed to macro unease around the globe.

Australia

  • New crop grower bids again firmed across the board by $2-3/t with wheat leading the way, ASX valued at $335/t for east coast Jan 21 with a last minute spike at close
  • Storm activity pushed through the northern harvest regions resulting in some harvest delays, forecast is still calling for some big falls
  • Northern growers are focused on getting the crop in the bin, as a result little selling activity has been seen
  • Southern canola crops setting up well for windrowing in the next 12-14 days
  • WA and western SA harvest continues to trickle in. Viterra has received a little over 10,000mt for the 20/21 harvest thus far.

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Source: Lachstock Consulting

 

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