Markets

Daily Market Wire 3 June 2021

Lachstock Consulting, June 3, 2021

Spring wheat and oilseeds continued firmer.  Other wheats and corn retreated from the previous surge.

  • Chicago wheat July contract down US6c/bu to 687.5c;
  • Kansas wheat July contract down 3.75c/bu to 633.75c;
  • Minneapolis wheat July contract up 11.5c/bu to 783c;
  • MATIF wheat September contract down €3.75/t to €215/t;
  • Corn July contract down 13.75c/bu to 675c;
  • Soybeans July contract up 14c/bu to 1562.5c;
  • Winnipeg canola July contract up C$11.50/t to $908.20;
  • MATIF rapeseed August contract up €2.25/t to €534.25/t;
  • US dollar index unchanged at 89.9;
  • AUD weaker at US$0.774;
  • CAD firmer at $1.204;
  • EUR unchanged at $1.221;
  • ASX wheat July contract up A$3.50/t to $306.50/t;
  • ASX wheat January 2022 up $4.50/t to $315/t.

International

Minneapolis, the new driver of the ag markets, rallied 11.5c/bu to settle at 783c/bu. Conditions throughout the northern plains have slid from bad to worse and the market is doing what it does best in wheat, ration demand.
Weather markets are not for the faint hearted. Excessive rainfall throughout the southern HRW belt and extreme dryness in the northern spring wheat belt. Throw in what is being billed as the largest corn planted area with all the growing season in front of it and we are only just kicking off. Oh, did I mention it’s a little damp in Russia? This is a market wire not an opinion piece. However, rain in Russia is not all bad this time of year bearing in mind that spring wheat contributes around 25pc of total wheat production which is certainly benefiting from the current wet pattern.
Financial services provider StoneX, formerly INTL FCStone, has gone hard on Brazil, posting a 89.68 million tonnes corn (Mt) crop estimate. This comes off the back of yesterday’s 90.9Mt AgRural print which makes the USDA’s 102Mt estimate seem high.
Live cattle futures traded on the CME concluded the day 2.3 percent higher, at $1.1975c/lb, after plunging in response to a cyber-attack on JBS systems. JBS announced in a statement yesterday that most of its activities would be back up today following the attack the day before. However, the supply chain delays caused by the incident appear to be raising cattle. “Even a one- or two-day disruption will tend to clean up spot supply fast,” according to Steiner Consulting Group. “Those who like to buy on the spot market may find that what was already a difficult market has become impossible.”
The Purdue University/CM Group Ag Sector Barometer fell 20 points to 158 in May, the lowest reading since September 2020, reflecting farmers’ concerns about the country’s agriculture economy.

Australia

Markets kicked along yesterday following the strong move on the offshore boards. We saw current crop wheat and barley find a bid along the east coast and tonnes continue to move out the door. It still feels well supportive with current export program plus domestic buying for the next 3-month cover. New crop markets were firmer across all commodities yesterday with wheat up $3-4/t, barley up $2-3/t. Canola moved strongly again, values pushing firmer by $20/t. WA canola grower bids advanced towards $800/t FIS.
Rabobank released it’s latest Australian winter crop outlook with a near record planted area going in with ideal conditions, total winter crop plantings projected 22.93 million hectares, up 2pc on previous year. ABARES will release a report this month. Lachstock latest wheat, barley and canola production totalled 43Mt.
Weather maps continue to improve for large part of SA, Victoria and NSW with most cropping regions expected to receive minimum of 5-10mm in a 8-15day event. This will maintain yield expectations in most areas of Victoria and NSW, while it will benefit germination in South Australia.

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