Daily Market Wire 22 October 2018

Lachstock Consulting, October 22, 2018

Mixed for grains and oilseeds.

  • CBOT wheat up 1.75c to 514.75c,
  • Kansas wheat up 1.5c to 516.25c
  • Spring wheat up 3.75c to 588.75c..
  • CBOT corn down -3.75c to 367c
  • Soybeans down -6.75c to 856.75c.
  • Winnipeg canola up C$4.10 to C$494.70
  • Matif canola up €2.50 to €373.25,
  • Dow Jones up 64.88 to 25444.34
  • Crude oil up 0.83pc to $69.28
  • AUD down to 0.15pc $0.71,
  • CAD up 0.04pc to $0.762,
  • EUR down 0.02% to 1.151.


Wheat finished fractions higher, showing weakness into the close. Implied vol in Dec SRW finished at 20.75%. Matif Wheat was unchanged at 201.25€, Black Sea Wheat was up 0.5$ to 246$ and the Ruble was up 0.47% to 0.01527. Global cash markets were weaker with Russian values retreating, supported by a stronger local currency and better South American competition. Argentina’s presence is being felt as grower selling increases, along with a large paper position that is held by the trade there (talk of 6mmt). Looking to new crop there are still areas for concern in Europe where dry conditions, particularly in the west, are creating concerns for winter wheat plantings. The COT had SRW -43.8 from -43.4k contracts, HRW +16.2k from +16k contracts and Spring wheat -2.4k from +3.2k contracts.


Corn sold off further, feeling the pressure from a retreat in global cash prices as Argentina and the Black Sea continue to grind lower. The Ukrainian crop is surprising to the upside, with yield projections now calling for a crop larger than the USDA’s 31mmt forecast. The COT had corn short -28.6k from -80.7k contracts.


Soybeans finished lower as the same set of circumstances continue to add weight. Reports that 300kmt of sales were cancelled did not help the flavour at all. Soybean Meal was down US$-3.2 per tonne and Soy oil was down -0.37 points. The commitment of trader’s report (COT) had the short at -94.4k from -101.7k contracts last week.


Canola couldn’t escape the carnage in beans and vegoils settling lower in both contracts.


Aussie markets finished the week on a softer note after a week of beneficial weather for summer crops, softness in futures markets and our proximity to harvest. Shorts have backed off, preferring to wait and see what harvest brings vs. continuing to bid into limited liquidity. The weather forecast features patchy showers in NSW and QLD, but the rest of the country remains dry. Summer crop price action could dominate local markets today, if sorghum selling gets underway as grower confidence builds.

Source: Lachstock Consulting


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