Daily Market Wire 28 July 2020

Lachstock Consulting, July 28, 2020

Wheat fell 1-2pc. Oilseeds firmed.

  • Chicago wheat September contract down US11.75c/bu to 527.75c
  • Kansas wheat September contract down 10c/bu to 439.5c;
  • Minneapolis wheat September contract down 7.25c/bu to 508c;
  • Corn September contract down 1.25c/bu to 325;
  • Soybeans August contract up 1.75c/bu to 906.5;
  • Winnipeg canola November contract up C$1/t to $488.70;
  • MATIF wheat September contract down €3/t to €182.75;
  • MATIF rapeseed August contract up €4.75/t to €382.25;
  • Brent crude September contract up US$0.07 per barrel to $43.41;
  • Dow Jones index up 115 points to 26,585;
  • AUD firmer at $0.7139;
  • CAD firmer at $1.3365;
  • EUR firmer at $1.1738.

US harvest progresses

A US crop progress report came out after yesterday’s market close, with soybeans and corn both up three points to 72 per cent good to excellent, and spring wheat up 2pc to 70pc good to excellent. Sorghum conditions were also up 2pc, although still very poor versus prior years.  More feedback on US corn crops is also starting to come through as companies and analysts start to tour, and lots of optimistic discussion on yield prospects is coming out.  The US winter wheat harvest is winding down, with USDA pegging it at 81pc complete, with basically only Montana and the PNW left to come off.  Spring wheat is also starting (USDA figures 1pc done), and we note that this week already, we have heard of early fields in southern Montana moving, while USDA figures had them yet to start.  We’ll start seeing many more yields come in across the next week or two, although the bulk of harvest wont hit until mid August.  We also saw another set of flashed US sales – two boats of Chinese beans and 250k of beans to Mexico.

Russian wheat

Globally, the biggest talk on the wheat market to start the week has been Russian wheat yields, with some analyst groups there highlighting recent improvements as harvest moves north.  Given the weather patterns, we don’t see much surprise there, but markets love to over-respond to crop news, and it’s been a good excuse for some of the longs to exit.  Russia’s spring wheat harvest is still to come, which will drive the overall number, but most of the figures for winter wheat, which comprises the majority of export flows, have been fairly well run over by the trade.


Australian markets held up yesterday after the Friday CBOT rally, with the ASX pushing over 300 on Jan, though it did trade $2/t lower this morning.  Volumes remain light, and some regional production concerns have been building.  Some parts of southern Queensland, the Mallee border regions, and towards the southern edge of the wheat belt in WA are all starting to show some moisture stress.  Most other zones are still holding up with some solid potentials around, but we still need to see some more moisture coming, and soil-moisture levels are drawing down.  Extended-run weather maps are starting to push a little bit of precipitation across the country for later next week, but nothing major yet.  With the AUD still holding firm and trading towards 71.7c, we’re also keeping an eye on the FX impact back to grains.
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