Chicago wheat finished limit up, Kansas near limit up. MATIF wheat and rapeseed futures traded an almost 10 per cent day price range, the wheat closing 7pc firmer and rapeseed 3pc. ASX eastern wheat futures current and new crop lifted 4pc and 5pc.
- Chicago wheat May contract up US50cents per bushel to 934.75c/bu;
- Kansas wheat May contract up 48c/bu to 966c/bu;
- Minneapolis wheat May up 17.5c/bu to 1020.25c/bu;
- MATIF wheat May contract up €21/t to €315/t;
- Black Sea wheat March contract up $10/t to $326.50/t
- Corn May contract up 9c/bu to 690.25c/bu;
- Soybeans May contract down 17c/bu to 1654c/bu;
- Soybean meal firmed 2pc;
- Winnipeg canola May 2022 contract up C$19.30/t to $1052/t;
- MATIF rapeseed May 2022 contract up €23.25/t to €763.50/t;
- ASX March 2022 wheat contract up A$16/t to A$385/t;
- ASX Jan 2023 wheat contract up $20/t to $405/t;
- AUD dollar 1pc weaker at US$0.717;
- Brent crude oil futures volume spiked and price firmed;
- Dow Jones Industrials Average up quarter per cent.
Does technical analysis matter? Trading strategies built around technical indicators and chart patterns would be sending some pretty conflicting signals today.
Markets witnessed huge rejections of the highs in many markets having spiked sharply as Odessa was bombed and reports of shipping being suspended in the Azov Sea emerged.
US exchanges were locked at their trading limits; up 50usc/bu in Chicago wheat with the implied moved derived by the options markets indicating the real market was closer to 75usc/bu higher. Then, for reasons not completely clear to me, some of the more extreme moves found selling. Someone, in the midst of the outbreak of war decided they would sell the market. Do they think values had simply moved too far too quickly?
Looking back to 2014 when Russia invaded Crimea, Chicago wheat added around $1.30/bu (from a much lower base) over almost 2 months. This time it did it in 3 sessions.
USDA in its Outlook Forum this week predicted global stocks would tighten and prices would fall. US Agriculture Secretary said sanctions might limit Black Sea region grain exports but the effects would not filter down to US consumers.
Egypt’s GASC cancelled its wheat tender having received just one offer.
Despite large price moves offshore the Aussie cash wheat market yesterday continued. Sellers continue to come to market and buyers do not feel the need to push values any higher. Export focus on SFW delivered Geelong Melbourne did push those values $5/t higher. Wheat basis continues to weaken, both current crop and new crop. Port Kembla basis is about minus $75/t.
Barley values also remained largely unchanged.
Canola firmed $10/t yesterday track Port Kembla. Victorian canola prices exceed $900/t, lifting $105/t in the past month.
The liquidity continues to flow, Clear Grain Exchange reported high volume of trade, 174,000t, much of it in Western Australian wheat and barley.
The demand for delivered commodity in eastern Australia remains strong as truck freight availability continues to be tight and road rates firm.
Source: Lachstock Consulting