Markets

Daily Market Wire 28 April 2020

Lachstock Consulting, April 28, 2020

Wheat continued lower.

  • Chicago wheat July contract down US5.75¢/bu to 524.75¢;
  • Kansas wheat July contract down 3.75c to 479.5¢;
  • Minneapolis wheat July contract down 4.5c to 508.75¢;
  • MATIF wheat September contract down €3 /t to €187;
  • Corn July contract down 9.75c/bu to 313.25¢;
  • Soybeans July contract down 3¢/bu to 836.5¢;
  • Winnipeg canola July contract up $C1.80 to $461.10/t;
  • MATIF rapeseed August contract down €1.50/t to €363;
  • Brent crude June contract down US$1.45 per barrel to $19.99
  • Dow Jones index up 359 points to 24134;
  • AUD firmer at $0.6460;
  • CAD firmer at $1.403;
  • EUR firmer at $1.083.

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Markets

Markets started the week again weaker. Chicago wheat was off 5 3/4¢ to 524 3/4¢, KC -3 3/4¢ to 479 1/2¢, Minny -4.5¢ to 508 3/4¢, and Matif gave up another three euros to 187€ on the improved Russian moisture ideas. Corn crashed off 9 3/4¢ to 313 1/4¢ and beans gave up three cents to 836.5¢ (Matif was off a euro fifty to 363€ and Winnipeg gained a buck eighty to $461.1).  Crude oil has continued to crash with demand and storage problems abundant – WTI hit $12.8 and Brent has dropped to $20, even as the DOW picked up 358 points as ideas of an economic reopening continue.  Coronavirus worries do remain in place around the world, but the last week or so has seen a massive focus on “reopening” – raising worries about a second wave of cases but also boosting some hopes for an economic turn around.  The AUD has firmed to 64.6¢, the CAD $1.403, and the EUR is at $1.083 currently.

After the close, the US weekly crop condition report brought positive news for wheat prices. Winter wheat good/excellent condition ratings were off 3pc. In Kansas it was reported down 6pc as more of the weather stress came through in the assessments. Spring wheat was 14pc planted, corn 26pc and beans 8pc.

US weekly export inspections were also generally positive; 1.078Mt of corn, 556,000t beans, 501,000t wheat including durum exported from the Great Lakes to both Italy and Algeria, and 205,000t of sorghum to China.

US domestic feed grain demand remains a concern. Slaughter house closures are backing up the meat pipeline. JBS evidently reopened some plants it previously shut, but closed another one. Two steps forward, one back.  Year-to-date slaughter figures in the US on cattle are down nearly 2pc.

Saudi bought 11 wheat cargoes at tender. The August arrivals traded in the low $220s per tonne C&F. New crop price inverse was clearly visible in the results, the July positions trading above $240/t.  Saudi also bought a boat of Ukrainian 11-pro in a direct deal designed to support Saudi-owned ag investments overseas.

Russian weather maps remain very dry across much of the South and Volga but there’s been some more fill in on the models for the two-week outlooks. Still to be seen if the models will translate into rain, but with the ongoing dry/warm conditions the stress there is building.

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Australia

Australian markets were very quiet to start the week, although ASX wheat January 2021 traded $325/t, off $7/t from last week.  Markets remain offer-side heavy, though there’s also relatively limited involvement from the farmer on old crop. Some have already sold and others are not interested with the weakening US futures.  New crop continues to gradually soften on the global weakness.  Planting is well underway, with completion ranging up to 30pc in early areas.

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