Markets

Daily market wire 27 June 2017

Lachstock Consulting, June 27, 2017

Overnight markets:

Mixed for grains and oilseeds.

CBOT Wheat down -8c to 465.5c

Kansas wheat down -11c to 471.5c

Corn up 1.75c to 367.25c

Soybean up 2.75c to 911.25c

Winnipeg Canola down -1.09$C to 474.1$C

Matif canola down -0.75€ to 356€

Dow Jones up 14.790 to 21409.55

Crude Oil up 0.480c to 43.49c

AUD up to 0.758c

CAD down to 1.324c, (AUDCAD 1.004)

EUR down to 1.118c (AUDEUR 0.677).

Soybeans

Soybeans posted a stronger close, with limited selling around given the large increase in the short position, combined with technical support. A rally late in the session had beans up almost 8 cents, although this could not be sustained as buying exhausted. Weekly export sales were better than expected which helped things along. Demand is light with China inactive given their large oilseed supplies at port, brought on by record imports recently. Despite the large global stocks in the hands of growers, liquidity has dried up given the recent flat price declines.

Canola

Canola slightly lower in a quiet session, with talk of frosts in the Canadian prairies raising some concerns, though only minor at this stage. Stats can is out on Thursday with fresh acreage numbers, which will help paint a better picture of the Canola scenario. The markets view is that most of the intended acres were planted despite the delays, so anything contrary to that could affect prices.

Corn

Corn slightly higher, catching some breath after a string of lower sessions.  USDA report will add some uncertainty with corn stocks and acres reported, with the expectation of lower corn acres in favour of beans. Weekly sales were better than expected which was a small positive in a quiet session focused mainly on favorable weather and consolidation. Global weather features concerns mounting over the Ukraine crop with limited available moisture, if realized this would have a reasonably bullish impact on EU feed grains.

Wheat

Wheat mixed across the classes with spring wheat still showing strength, while winter wheat’s experienced a decent sell off. Similar to corn last week, the COT report revealed a significant reduction in the short position, which the market deemed to be unsupportive. Volatility in the September contract was off at 25.5%. Quality report/estimates calling the HRW protein level at an average of 11%, which is the lowest level in 18 years. Conditions reports revealed spring wheat down 1% week on week, to 40% good to excellent. Winter wheat harvest is 41% complete. On the global front, rainfall in Europe put pressure on things there, despite hot temperature forecasts, the rain is expected to stem the yield losses that have raised concerns in the last two weeks. Ukraine is looking at dry hot weather, which may cause damage considering their recent conditions.

Australia

Australian forecast similar to yesterday, SA is getting nothing, WA is patchy and in the wrong areas. While NNSW and SQLD are looking at 10-25mm, which will encourage wheat planting just in the nick of time..

Source: Lachstock Consulting

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