The day ahead
Weather – All about Australia. Falls right across the east coast are expected over the next few days – parts of SA got over 30mm yesterday. Damage will be debated today. Argy wheat and corn areas continue to get whacked, as does eastern France – should support global values today.
Markets – Pretty impressive performance by wheat really, shaking off the crop condition report showing the biggest ever jump in conditions. But, it was all about Donald Trump. He released a statement indicating that he was targeting China and Mexico with tariffs which was most supportive to beanoil given the amount of veg oil that flows into the US from those countries. This is going to be a bumpy ride.
Australian day ahead – Will this rain event cause damage – will it just be quality or quantity? – suggest values remain bid for quality if nothing else today. AUD lower will support this.
Offshore
President-elect Donald Trump announced plans to implement a 10pc tariff on Chinese goods and a 25pc tariff on all imports from Mexico and Canada, citing concerns about illegal drug trafficking and immigration issues.
In a series of posts on Trump Media & Technology Group platform Truth Social, he stated that these tariffs would remain until countries effectively address problems like the influx of fentanyl and illegal immigration, emphasising their responsibility to resolve these challenges. His proposals align with his “America First” policy, aimed at reshaping trade to benefit US interests while addressing complex cross-border issues. However, these measures have sparked concerns among economists and industry leaders about potential economic repercussions and escalated trade tensions.
South Korea purchased 198kt corn in two tenders, with 133kt sourced from the US, South America, or South Africa, and 65kt from the US or South America. South Korea also bought 50kt US milling wheat. Jordan and Tunisia made significant wheat purchases, while Bangladesh tendered for 50kt of rice.
Chinese buyers are increasing soybean purchases from Brazil, taking advantage of favourable prices and securing supply amid rising US trade tensions. Brazil’s record harvest is expected to meet at least half of China’s demand for February-April and 20pc for May-June.
The US Conference Board’s Consumer Confidence Index increased by 2.1 points in November. The present situation index rose by 4.8 points, while the expectations index gained 0.4 points. Optimism regarding job availability reached its highest level in three years, and inflation expectations decreased to 4.9pc from the previous 5.3pc.
Australia
Wheat futures forward curves mostly are pricing carries, predictably MATIF wheat is leading. Canola/rapeseed is a mixed bag. Click expand.
Canola values in the west worked higher yesterday to be bid $816 with a $110 spread to GM. Cereal bids were unchanged.
In the east canola bids made back some recent losses, moving $10-15 higher to be bid around $765 with the spread to GM now out to $100. Wheat bids were firm for higher protein grades, with feed wheat $5-10 lower, and ASW around $325, likely in response to the recent and forecast rain for the eastern states.
Growers in Western Australia had delivered 8.9Mt of grain to CBH up to Sunday the 24th, with the daily receival record broken last Monday when 620kt was delivered, surpassing the previous record of 603kt set in the 2022/23 growing year.
Faba bean demand remains strong, with Jan+ delivery bid $680 into Geelong/Melbourne.
There were some decent falls last night through the South East of South Australia and into the Western Districts of Victoria, where between 30-40mm fell throughout most parts. There is still 25-50mm forecast for most of Victoria for the coming week, with 50-100mm forecast for most of NSW.
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