Markets

Daily Market Wire 29 July 2021

Lachstock Consulting, July 29, 2021

Wheat lifted mostly 2pc overnight, led by springs at 3pc. Canola was mixed.

  • Chicago wheat September contract up US14.25c/bu to 688.75c;
  • Kansas wheat September contract up 18c/bu to 659.5c;
  • Minneapolis wheat September contract up 25.5c/bu to 903.75c;
  • MATIF wheat September contract up €4.25/t to €216.25/t;
  • Corn September contract was up 0.5c/bu to 549.25c;
  • Soybeans September contract up 3.25c/bu to 1370.25c;
  • Winnipeg canola November contract was down C$11.40/t to $883;
  • MATIF rapeseed August contract up €5.75/t to €535/t;
  • US dollar index down 0.2 to 92.3;
  • AUD firmer at US$0.737;
  • CAD firmer at $1.252;
  • EUR firmer at $1.184;
  • ASX wheat September contract up $3.80/t to A$309.30/t;
  • ASX wheat January 2022 up $4/t to $312/t.

International

The spring wheat rally led wheat higher last night with Minny +25.5¢, KC +18¢, Chicago +14 1/4¢, and Matif +4.25€ on the earlier close. Corn was up half a cent and beans +3 1/4¢ (Matif +5.75€, Winnipeg back off $11.4).  Macro markets have crude trading up to $72.4 WTI / $74.7 Brent while the DOW gave up 128 points.  The AUD is holding around 73.7¢, the CAD $1.252, and the EUR $1.184 with the dxy hitting 92.3 after a US infrastructure deal appears to have been reached.

The US Federal Reserve commented optimistically about the economy, left interest rates and bond purchase programs unchanged and said it would wait for job increases before making any changes.

Corn Belt weather maps mostly were unchanged, forecasting moisture for western areas of Iowa and Missouri but not southern Minnesota and the Dakota corn areas.

The second day on the road for the US spring wheat crop tour – continued to report plenty of damaged/stressed crops as expected, though noted a few better than expected areas.  No real conclusion yet, but markets are watching how they finish up with the last travel day tomorrow.  Lachstock does also note that this year the tour is not covering any part of the Montana crops where early harvest yields to date have seen ranges from the mid 20 bu/acre down sub-5.

We haven’t seen an updated RMA indemnity map since early July but, with adjusters running around constantly through drought impacted areas, that’s likely to see massive increase in indemnities when released. Next Monday’s trading session will start the harvest price averaging window for spring wheat which, at current board levels, will see a near 40pc increase in coverage values.  Row crop harvest prices for the central Corn Belt will not be calculated until October.

US ethanol production this week was 1.01m bpd, down about 14,000 bpd from the week prior and a multi-week low.  Stocks continued to build though, up to 22.7 million.

Following ADM’s great earnings the other day, Bunge has increased their earnings outlook by a buck a share, citing the same benefits from high crush margins and trading opportunities.

Jordan’s MIT cancelled their barley tender again, citing not enough participants offering.

Black Sea markets continued to see harvest moving forward, and crop ideas are still consolidating into the high 70s million tonnes (Mt) range for Russia; ProZerno calling it around 77Mt in comments last night.

Australia

Local markets trading mixed yesterday with a little firmness in delivered bids but nothing exciting on the track side for grains.

Prospects for SA and parts of Vic are starting to catch up to the rest of the country after the recent weather. There are heading into spring with improving crop conditions albeit slightly delayed where the break was late.

Weather maps remain steady for the rain forecasts in WA, in addition to the 5-20 mm falls received across the wheat belt yesterday.

 

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