Markets

Daily market wire 30 January 2018

Lachstock Consulting, January 30, 2018

Higher for grains and oilseeds. 

  • CBOT Wheat was up 8.25c to 449.25c,
  • Kansas wheat up 10c to 453c,
  • corn up 2.25c to 358.75c,
  • Soybean up 5.75c to 1002.75c,
  • Winnipeg Canola up 2.89$C to 503.2$C, and
  • Matif canola up 4.5€ to 345.75€.
  • The Dow Jones down -101.12 to 26515.58,
  • Crude Oil down -0.579c to US$65.56/barrel,
  • AUD down to 0.809c,
  • CAD up to 1.232c, (AUDCAD 0.998)
  • EUR down to 1.238c (AUDEUR 0.653).

Wheat

Wheat was the leader today.

Adverse weather and strong export inspections prompted funds to cover shorts, and greatly improved the technical picture in Soft Red Winter (SRW) and Hard Red Winter (HRW) wheats. Both traded convincing through their respective 100-day moving averages.

Implied volatility in March SRW went out at 19.91pc.

Last week’s inspections came in at 579,000t, which was 36.89pc higher than the week earlier, and 74.63pc higher than the same time last year.

Russian values remain steady at US$195/t FOB (free on board), while Matif was €1.75/t higher supported by Saudi business which is now showing up in the French line-ups.

We will see updated HRW condition reports later today, which will be watched closely given the fund shorts and recent price action.

Soybeans

Soybeans managed a stronger finish despite last week’s export inspections, 1.105 million tonnes (Mt), the lowest since September last year.

Weather concerns of too-dry conditions in Argentina and too-wet in Brazil are keeping things supported. Meal was up US$1.7/t while soy oil was 8 points stronger. 

Canola

Canola managed a higher finish after last week’s figures of higher crush margins and utilization.

Global basis has rallied and, with limited grower selling, bids are increasing to secure adequate supplies. 

Corn

Corn finished fractions higher, with last week’s export inspections 993,000t. It’s expected that this demand will continue to improve with US corn the cheapest origin by $2-$3/t . This has prompted some non-traditional demand, such as Egypt’s purchase of 115,000t of US corn, announced in a flash sale.

The recent rally in corn has sparked a large amount of grower selling, which may apply less downside pressure going forward, with this weight of volume no longer present.

Australia

Aussie markets were reluctant buyers yesterday, despite the futures movement, in typical Monday trade fashion.

The AUD continues to challenge local flat price given its ongoing strength.

Barley markets continue to be well bid in USD terms, given the constancy of Chinese demand. We expect to see things quieter momentarily while China settles for their upcoming lunar New Year holiday.

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