Daily Market Wire 27 March 2019

Lachstock Consulting, March 27, 2019
A reminder that this Friday evening will be the USDA reports on acreage and stocks
Futures mixed; Tuesday’s settlements as follows;
  • CBOT Wheat May contract was down 0.25c to 469.25
  • Kansas wheat May contract down 6c to 443.25c
  • Corn May contract down 2.5c to 377.25
  • Soybeans May contract down 5.75c to 900.75c
  • Winnipeg canola May contract was down C$5 to C$451.70
  • MATIF rapeseed May contract up €1/t to €360
  • Dow Jones up 14.51 points to 25,516.83
  • Crude oil May contract up $1.12 to 59.94
  • AUD up to 0.7130c,
  • CAD up to 1.338,
  • EUR down to 1.126.

Commentary on markets

Wheat markets traded up to start the session in the US amid support from the GASC tender, but traded back down through the end of the session to close -1/4¢ on Chicago to 469 1/4¢, -6¢ on KC to 443 1/4¢, -6¢ on Minny to 567 1/4¢, and -1.5€ on Matif to 188 in the earlier close. Row crops also weakened, with corn -2 1/2¢ to 377 1/4¢ and beans down 5 3/4¢ to 900 3/4. Winnipeg canola saw a renewed selling wave to drop $5 to $451.7 after formal news that Glencore/Viterra has also lost their import license and Matif rapeseed picked up 1€ to 360€. Crude oil was up a buck ten to $59.9/barrel ($68 Brent) and the DOW picked up 140 points. The AUD has continued to strengthen, trading up to 71.3¢, while the EUR is off to $1.126 and the CAD at $1.338.

Egypt business concluded EU, Black Sea origins and US wheat

GASC offers and results started trickling in late last night, with two boats of SRW on offer from Cargill and a large mix of EU/BSEA offers (including four more Romanian boats – unusual for this time of the year). Russian offers were still present, but with the tightening domestic situation and firmer ruble (up ~2.5% in the last two weeks) there was only one boat that was close to competitive. GASC booked both the SRW boats (which were cheap enough to overcome the additional freight cost) at low $248 C&F values. We didn’t see any HRW in the mix – but no real surprise at current basis levels.

EU wheat export slow, northern hemisphere spring news mostly optimistic

EU published weekly export figures were only ~370 kmt for the last week – still down ~1.6 MMT YOY despite the increased export push in the last few weeks. Meanwhile, although US spring planting has been delayed after heavy rains/flooding and cool conditions, Black Sea field work has continued in mild weather – Ukraine government figures calling spring plantings (of all crops) ~42% complete already. US crop conditions out yesterday morning after our wire continued to show good results across the HRW belt of the US – Kansas was up 1% good/excellent and Oklahoma was up some 14% more into the good/excellent category. The crop is still just getting going after winter, with Oklahoma figures putting jointing progress at 28% (vs normal levels ~38%), but the improved moisture has clearly helped.


News headlines suggest that the rest of the world has finally noticed that there has been some rain down under. Not as much as hoped for (and the heavy rains in CQ really don’t help the wheatbelt much) but something is better than nothing. We’re still watching the models for later week rains and hoping to see some expansion further south, but at current they’re only calling for some light sprinkles into Central West and Riverina (but 20-30+ mm in N NSW and southern QLD).

Source: Lachstock Consulting


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