Daily market wire 27 November 2017

Lachstock Consulting, November 27, 2017

Overnight futures markets:

Lower for grains and oilseeds, after the US Thursday Thanksgiving holiday.

  • CBOT wheat was down -6c to 434.75c,
  • Kansas wheat down -6.5c to 432c,
  • Corn down -2c to 355c,
  • Soybean down -4c to 993.25c,
  • Winnipeg Canola down -1.10$C to 519.4$C,
  • Matif canola down -0.25€ to 371.5€.
  • The Dow Jones up 31.81 to 23557.99,
  • Crude Oil up 0.949c to 58.97c,
  • AUD up to 0.762c,
  • CAD up to 1.271c, (AUDCAD 0.967)
  • EUR was up to 1.194c (AUDEUR 0.637).


Poor export sales and mild weakness in cash markets saw wheat tumble. Export sales were less than half the markets expectations at 199,800t, to meet the USDA’s forecast they need to be 366,000t per week. This combined with slight weakness in Russian prices to see wheat reach new lows in Soft Red Winter (SRW) and Hard Red Winter wheat. Implied vol in March SRW went out at 18.87 per cent. Volumes were down slightly, but still above average. The USD was weaker, but could not encourage any price support, despite an Iraq tender which should see HRW in a the mix.


Corn followed weakness in wheat to finish with slight losses. Weekly sales came in at 1.08 million tonnes, which was at market expectations and above the 668,000t required to meet USDA forecasts. The forecast for Argentina is calling for some rainfall next week in the drier areas, which contrasts the La Nina fears that kept things supported last week.


Soybeans couldn’t break through technical resistance at US$10/bu, which saw a reversal to the downside. Lower than expected export sales and an improved forecast in parts of Argentina helped drive things lower. Soymeal was down 60 cents per tonne, while oil was 11 cents per pound higher. There was no Commitment of Traders Report due to the interrupted week; this will be in tonight’s session.


Canola saw some follow through selling on the back of weaker veg oil prices, which were prompted last week by India’s government, who imposed a tax on imported palm oil. Export demand has slowed slightly, although there is a good amount of vessels scheduled to load out of Canada.


The 8-day forecast for Australia is calling for 50-100 mm of rainfall in NSW and parts of Victoria in the later parts of this week. Farmers will be harvesting day and night in order to get the crop off in time, because if they don’t then quality issues will be significant. Cash prices have been stable and should probably strengthen today in relative terms, as this rain forecast will reduce any grower selling and may get the trade a little anxious.

Source: Lachstock Consulting




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