Markets

Daily Market Wire 3 May 2021

Lachstock Consulting, May 3, 2021

Corn closed limit up, almost 4pc, soybeans, canola and spring wheat rose more than 2pc.

  • Chicago wheat July contract up US5.75c/bu to 734.75c;
  • Kansas wheat July contract up 9c/bu to 703.5c;
  • Minneapolis wheat July contract up 19.25c/bu to 763.75c;
  • MATIF wheat September contract up €0.50/t to €219.25/t;
  • Corn July contract up 25c/bu to 673.25;
  • Soybeans July contract up 32c/bu to 1534.25c;
  • Winnipeg canola July contract up C$25.90/t to $868.70;
  • MATIF rapeseed August contract up €5.50/t to €504/t;
  • US dollar index up 0.7 to 91.3;
  • AUD weaker at US$0.771;
  • CAD unchanged at $1.228;
  • EUR weaker at $1.202;
  • ASX wheat July contract down $2/t to $309/t;
  • ASX wheat January 2022 down $5/t to $312/t.

International

Strong gains through Friday trade again with row crops continuing to explode – corn was up limit (25¢) and beans +32¢ (Matif +5.5€, Winnipeg +$25.9) and options indicating higher moves. Wheat gained 5 3/4¢ on Chicago, +9¢ on KC, +19 1/4¢ on Minny, and Matif +0.5€ on the earlier close.  Macros saw more weakness though, with crude given up a buck forty to $63.6 WTI / $66.8 Brent as the Indian coronavirus outbreak continues to weigh on demand ideas globally and the DOW dropped 186 points.  The USD has jumped back to 91.3, with the AUD at 77.1¢, the CAD $1.228, and the EUR $1.202.

The USDA May WASDE report will publish on Wednesday week, USDA’s first formal global figures for the new crop.

India continues to report record coronavirus cases and the daily death toll is rising. Some Indian states are imposing lockdown to attempt to stop the surge.

At the same time, EU countries are starting to push towards re-opening, with France and Spain both aiming to be fully re-opened by the end of June as they hope for an end to the “third wave” there.

CME expanded daily price limits will apply from today, 40¢ on corn up from 25¢/bu, 100¢ on beans up from 70¢/bu and 45¢ on wheat futures up from 40¢/bu.

First notice day on grain contracts for May had five contracts of HRW, 200 of SRW, 66 of beans, and no corn (no surprise given basis – and note that May futures were up 37¢ as no limits in delivery).

CFTC figures released on Friday, based on data at Tuesday 27 April, drew some attention given the reduction in managed money corn length, off net 5000 contracts, despite the board rally.

Rain forecasts across the eastern corn belt have another 2-3+” still to come for most of the SRW areas this week, and there are better chances of moisture for some of the spring wheat areas in Montana/North Dakota

Meanwhile, Brazilian weather maps look empty, to put it lightly, for safrinha corn areas, with almost nothing coming out across the 2-week models as conditions continue to deteriorate there.  Crop ideas continue to see more cuts discussed.

France’s Ag Ministry also updated crop conditions, cutting its rating of good-to-excellent conditions on wheat by 4pc to 81pc.

Solid rains are forecast for most of central and western Europe this week though, so some are hoping for an improvement to crops with the moisture.

Black Sea markets are in holiday mode – happy Orthodox Easter.

The Kentucky Derby ran on Saturday in Louisville, Kentucky over a mile-and-a-quarter.  Congratulations Medina Spirit on a well run win.

Australia

    The USDA Australian ‘post’ initial estimate of Australia’s new crop wheat production is 27 million tonnes (Mt) and of barley, 10Mt. Lachstock presently forecasts them at 28.2Mt wheat and 9.8Mt barley.

The storm system moving across WA this week continues to expand with a solid 20-30 mm forecast across the entire wheat belt.

 

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