Markets

Daily Market Wire 26 March 2021

Lachstock Consulting, March 26, 2021

Wheat continued to sell down across the boards with little new to feed the bulls and a gradual improvement in ideas about the upcoming winter wheat crops globally. Crude oil was back down two bucks fifty with the last few days of volatile trading seeing both technical pressure and a swing back in focus from the Suez problems towards the EU lockdowns and overall economic concerns there.  The Dow closed up 134 points.

  • Chicago wheat May contract down US12.25c/bu to 612.5c;
  • Kansas wheat May contract down 9.5c/bu to 566.75c;
  • Minneapolis wheat May contract down 9.5c/bu to 617.5c;
  • MATIF wheat May contract down €4.50/t to €214;
  • Corn May contract down 6.75c/bu to 546.5c;
  • Soybeans May contract down 18.5c/bu to 1414.25c;
  • Winnipeg canola May contract down C$14.60/t to $781.50;
  • MATIF rapeseed May contract down €9/t to €516.25;
  • US dollar index up 0.4 to 92.9;
  • AUD unchanged at US$0.758;
  • CAD weaker at $1.262;
  • EUR weaker at $1.177;
  • ASX wheat May contract down A$4.20/t to $282;
  • ASX wheat January 2022 down $0.50/t to $295.

International

World sentiment on macro markets seems to have swung back to the negative with regard to the coronavirus situation – this week’s extended lockdowns in Europe and reports of new coronavirus variants around the world adding to fears that the improvements in vaccinations in the US may be offset by further slowdowns elsewhere.

At the same time, US jobless seasonally adjusted initial claims figures for the week ending 20 March fell to 684,000, the lowest since the start of the coronavirus problems last year.

The blockage of the Suez Canal by container vessel Ever Given has become something of a pop sensation, but there’s no clear answer about how long it will take to shift. The direct impacts to agriculture are still very minor, but the longer the delays the more increases in freight costs between Aus/Europe will add up.

The USDA released another sales flash, 110,000t old crop corn to Japan.

The regular weekly export sales report was massive, as expected, given Chinese flashes last week. Corn was 4.5Mt, wheat 0.34Mt, beans 0.1Mt also about as expected and one new boat of old crop milo/sorghum was reported sold to China.

Black Sea wheat markets are under further pressure with residual supplies working their way into the market as farmers approach the new harvest. Private forecasters have lifted wheat crop forecasts, one private analyst group lifting Russian wheat to just under 80Mt last night.  The crop is far from made in March. Weather maps are not the best, with moisture outlooks cutting back some on the extended model runs, but there’s little immediate concern being expressed.

Updated IGC estimates put world wheat at 790Mt for the coming season, up from 775Mt last year with carryout growing by 12Mt

Survey figures from Bloomberg had average bean area forecasts pre-report at 90.1 million acres, corn at 93.1.

Brazilian weather maps have taken another turn drier again, with 2-week outlooks drying out across almost all of central and southern Brazil.

Australia

Australia track prices were lower yesterday with the global weakness but little trade was reported other than a few ongoing logistical squeezes and not enough to move the market.

Following recent rains/flooding there is more talk about maximum areas being planted for the second year in central/northern NSW. Soil moisture profiles are fully filled and there’s substantial optimism to the coming crop.

BOM maps nearly unchanged. Weather is forecast to continue drying out into next week and extended runs also are dry, providing some nice opportunities for early fieldwork.

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