US credit agency Fitch Ratings has placed the US AAA credit rating on rating watch negative, as concern grows over the potential debt default. Fitch still expects a resolution to the debt limit before the June 1 deadline with negotiations ongoing. 

The Turkish runoff election will take place on Sunday 28 May between President Recep Tayyip Erdogan and his main challenger, Kemal Kiliçdaroglu, with Erdogan tipped to win. 

According to a statement from the Indian Farm Ministry, 2022-23 wheat production is seen at a record 112.7Mt (107.7Mt previous year). Despite the increase the government has ruled out lifting a ban on wheat exports but said exports through diplomatic channels will be considered on a case-by-case basis and that all supplies were needed for domestic procurement. 

Buenos Aires Grain Exchange said heavy rains in recent days across Argentina’s main production areas improved expectations for the 2023-24 wheat crop. The exchange expects wheat production to rebound to 18Mt from the drought-ravaged 12.4Mt crop produced the previous year. 

Refinitiv Commodities Research reported beneficial rainfall and temperatures in China’s key wheat producing areas in the north indicate that wheat yields will likely be record high, including in Hebei and Shandong provinces. Vegetation densities extracted from satellite imagery also show good or excellent crop conditions. With forecasts for favourable weather over the next two weeks, 2023-24 wheat production is seen fractionally higher than before, at 139.9Mt (137.7Mt previous year). 

EU vegetable oil and protein meal industry association FEDIOL has released a statement saying “imports of biofuels, classified as waste based, for example identified as HVO (hydro-treated vegetable oil) or FAME (fatty acid methyl esters) are taking place at such scale, that it has led to important disturbances in the EU markets for rapeseed methyl ester, and as a consequence also in the rapeseed and rapeseed oil markets. Over the last 5 months, prices for rapeseed oil have dropped significantly by over 30pc. This will not only impact rapeseed farmers’ revenue, but also future planting decisions. These trends cannot be explained by other market developments and are a signal that there is abnormal market behaviour. The magnitude of biodiesel imports’ growth is such that it raises question as to the authenticity of their classification as originating from waste streams and that there is urgent need to investigate the legitimacy of these imports”.

The Malaysian Palm Oil Board has said Malaysia’s crude palm oil production could drop between 1-3Mt next year due to the El Niño weather pattern. The weather event is unlikely to have a major impact on this year’s crop as it typically takes 15 to 18 months for effects to show.

The tide seems to have turned as we round out the week, with markets starting to move yesterday with the AUD softening we started to see more bid side interest step into the market. Current crop wheat and barley started to flow in both the east and the west and new crop bids were active in SA. Canola bids also firmed on new and current crop by $5-10/t with a little more liquidity and interest. 

We have seen some nice showers of rain through SA and Vic which will keep seeding programs on track and are perfectly timed for recently sown crops, although parts of Vic are now too wet. The mood is generally positive at this early stage, but the dry forecast is certainly on growers’ minds. The goal now is to jag enough early rainfall so crops can access stored sub soil moisture, to better withstand a dry winter.