Markets

Daily Market Wire 29 June 2021

Lachstock Consulting, June 29, 2021

Markets firmed.

  • Chicago wheat September contract up US10.75c/bu to 651.5c;
  • Kansas wheat September contract up 17.75c/bu to 626.75c;
  • Minneapolis wheat September contract up 26c/bu to 834c;
  • MATIF wheat September contract up €1.50/t to €203/t;
  • Corn September contract up 28c/bu to 558.25c;
  • Soybeans September contract up 41.5c/bu to 1315.75c;
  • Winnipeg canola November contract up C$30/t to $769.50;
  • MATIF rapeseed August contract up €11/t to €518/t;
  • US dollar index up 0.1 to 91.9;
  • AUD weaker at US$0.755;
  • CAD weaker at $1.235;
  • EUR weaker at $1.191;
  • ASX wheat July contract unchsngrd at A$293/t;
  • ASX wheat January 2022 up $2/t to $300/t.

International

Grain markets firmed back up sharply overnight, bouncing with ideas of buying the dip and position squaring as we come into this week’s reports. Corn gained back 28¢ and beans +41.5¢ (Matif +11€, Winnipeg +$30).  Chicago wheat was up 10 3/4¢, KC +17 3/4¢, Minny +26¢, and Matif +1.5€ on the earlier close.  Crude oil has dropped a buck and a quarter to $72.9 WTI / $74.7 Brent and the DOW off 150 points as macro markets weather concerns about the continued expansion of the new coronavirus variant and risks to demand recovery around the world.  The USD is steady near 91.9, with the AUD trading at 75.6¢, the CAD $1.234, and the EUR $1.193.

USDA’s upcoming quarterly stocks and acreage reports will publish on June 30th.

The coronavirus Delta variant continues to spread. Markets have been slightly spooked by the renewed lockdowns and calls for lockdowns globally amid concerns about the impact to the supposed post-corona re-opening.

OPEC+ has another meeting this Thursday. Despite thoughts they may further increase production there are reports that the UAE will cut production.

The regular weekly US crop progress report had corn condition rated at 64pc good-to-excellent, beans 60pc, milo/sorghum 70pc, and spring wheat down to 20pc rated good-to-excellent.  The progress of harvest for winter wheat harvest came in at 33%.

Egypt bought three Romanian wheat boats at a ~US$271/t C&F at the GASC tender.  Other Romanian origin cargoes were offered in the low $240s per tonne FOB, Ukrainian in the high $240s and Russian in the low $250s FOB.

No more flash US sales were reported, although there’s ongoing speculation about Chinese buyers having bought in the dip.

Finally generating discussion after heavy rain, worries about quality impacts in some of the US winter wheat crop are emerging, mostly SRW in the Ohio River areas, but at the same time recently harvested areas have continued to show good quality results. It is yet to be seen if there will be larger patches of off-grade grains.

Another inch to two is still forecast for the eastern corn belt this week, the latest weather maps forecasting slightly lighter for IL but heavier into IN/OH/KY.

US weekly export inspections came in at 1 million tonnes (Mt) corn, 0.104Mt beans and 0.3 Mt wheat, a fairly quiet result overall.  There was 37,000t of milo/sorghum exported to Sudan, but no more of the outstanding Chinese sales.

Surveyed figures for this week’s acreage and stocks report are averaging around 93.8 million acres corn and 88.9 million acres beans. Markets all agree on some increase, but the question is how much of one and the differences there can be several million acres.  Pre-report estimates of stocks figures are also fairly wide-ranging with averages about 4.1 bbu corn and 780 mbu beans.

Australia

New lockdowns in Australia are throwing a damper as the financial year comes to an end. The big question is how long they will last and whether we’ll see them keep extending like prior lockdowns.
BOM maps still fleshing out slightly better rains for northern NSW/Qld later this week, bringing expectations of a widespread half an inch to an inch for most of the Downs and northern NSW.

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