Markets

Daily market wire 30 August 2017

Lachstock Consulting, August 30, 2017

Overnight markets:

Mixed for grains, lower for oilseeds.

  • CBOT wheat up 1.75c to 429.75c,
  • Kansas wheat up 0.75c to 426.25c,
  • Corn down -2.25c to 348.75c,
  • Soybean down -4c to 937.25c,
  • Winnipeg Canola down -2.39$C to 505.5$C,
  • Matif canola down -2.5€ to 366.75€.
  • The Dow Jones up 56.96 to 21865.37,
  • Crude Oil down -0.14c to 46.43c,
  • AUD up to 0.795c,
  • CAD down to 1.251c, (AUDCAD 0.995)
  • EUR down to 1.197c (AUDEUR 0.663).

Wheat

Wheat was mixed with SRW and HRW just above unchanged, while spring wheat suffered 4 cent losses in the Dec contract. Implied vol in Dec SRW went out at 20.62 per cent (pc). All three contracts forged new lows, before buying was uncovered during the day session. A weaker USD is helping to keep US wheat competitive, which is preventing heavy selling for the moment. The Ruble closed back down through the key resistance it broke in the last two sessions and Russian cash prices responded accordingly. GASC bought 295,000t wheat from Russia and the Ukraine at levels between US$186-$187 free on board (FOB). Nearby values have since been quoted lower, likely on the back of the currency weakness.

Corn

Corn continues its death spiral, forging new lows. Fund selling is active and they are not particularly short compared to previous records, leaving plenty of room in the tank. On top of this, there are reports that US farmer selling has picked up slightly, with warehouses not allowing them to regrade old crop as new, forcing sales ahead of new crop to make room for storage.

Soybeans

Soybeans lower on improved yield potential and weakness in meal and oil. This week’s crop conditions improved up 1pc to 61pc good to excellent. Demand is not an issue in soybeans, with the lower flat price improving relative value to South American supplies, encouraging buyers. The USDA announced a private sale of 198,000t soybeans to China for 17/18.

Canola

Canola lower in a more active, higher-volume session. Weakness in the oilseed complex and better than expected early yield reports from Manitoba were the drivers. The increased volume could be attributed to more confidence in the final crop figure based on the early yields, or, position squaring ahead of the Statistics Canada report out Thursday.

Australia

Nothing significant from a moisture perspective in the Aussie forecast for the next 8 days. Damage assessment of the frosts over the last 3 days will take some time to determine, although it is not expected that huge yield losses occurred given the stage of plant growth. What it probably does is prevent upside in the NSW crop given the moisture losses that would have occurred, to an already parched crop. Cash markets remain quiet, with traders focused on the negative global influences, rather than the deteriorating Aussie picture.

Source: Lachstock Consulting

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