Markets

UPDATE: Daily Market Wire 31 October 2022

Lachstock Consulting, October 31, 2022

 

UPDATE: Asian timezone electronic trade in US wheat futures have rallied 3-5pc on weekend Black Sea news.

 

Friday was mostly a down day in US markets and Matif wheat gained a little, but Black Sea Grain Initiative news over the weekend likely will set markets up for movement when they reopen this week.

  • Chicago wheat December contract down US9.25 cents per bushel to 829.25c/bu;
  • Kansas wheat December contract down 7.25c/bu at 925c/bu;
  • Minneapolis wheat December contract down 5.5c/bu to 945c/bu;
  • MATIF wheat December contract up €1/t to €337.50/t;
  • Black Sea wheat December contract down US$3/t to $317.50/t;
  • Corn December contract down 1.5c/bu to 680.75c/bu;
  • Soybeans November contract up 5.5c/bu to 1387.75c/bu;
  • Winnipeg canola March 2023 contract was down C$4.80/t to $869.40/t;
  • MATIF rapeseed February 2023 contract down €3/t to  €638.75/t;
  • ASX Jan 2023 wheat contract  down A$5/t to $483/t ;
  • ASX Jan 2023 barley contract unchanged at A$340/t;
  • AUD dollar weaker at US$0.640.

International

Russia has suspended its participation in the export corridor for an “indefinite period” after what it said was a drone attack on Russian ships in occupied Crimea. It was bound to happen. Russia’s defence ministry said Ukraine attacked the Black Sea Fleet near Sevastopol in the annexed Crimean Peninsula with 16 drones in the early hours of Saturday, and that British navy “specialists” had helped coordinate the “terrorist” attack. London bluntly rejected Moscow’s claim. 

Russia said on Sunday that it will have “contacts” with Turkey and the UN “soon” on the grain deal, the state news agency TASS reported, quoting Deputy Foreign Minister Andrey Rudenko. But, it added, this would only happen once all circumstances surrounding “Ukraine’s attack” on its Black Sea fleet had been clarified, and a UN Security Council meeting held. 

UN Secretary General Antonio Guterres said he was “deeply concerned” by Russia’s decision and delayed a foreign visit to try to revive the agreement. “The Secretary-General continues to engage in intense contacts aiming at the end of the Russian suspension of its participation in the Black Sea Grain Initiative,” Guterres’ spokesman said.

Minister of Agriculture in Russia, Dmitry Patrushev said Moscow was prepared to “supply up to 500,000 tonnes of grain to the poorest countries free of charge in the next four months,” with the help of Turkey and that Moscow stands ready to “fully replace Ukrainian grain and deliver supplies at affordable prices to all interested countries.”

Buenos Aires Grain Exchange reports that 2022-23 wheat conditions are rated 48pc fair/excellent (48pc week ago, 82pc year ago), with recent rainfall reportedly improving crop condition in central and southern parts of Buenos Aires province. 

FranceAgriMer reports that as at 24 Oct French 2023-24 common wheat planting was 63pc complete (46pc previous week, 58pc previous year) and winter barley was 80pc done (67pc previous week, 76pc previous year). Maize harvest was 96pc complete (92pc previous week, 51pc previous year). 

IGC reports that South Korean flour millers purchased an estimated 128,000t milling wheat for Jan/Feb shipment, incl. 50,000t from the US – SW (8.5pc-11pc protein) at US$340.43 – $341.74/t fob, HRW (11.5pc) at $412.01-$412.22/t fob and DNS (14pc) at 403.83-$404.03/t fob; 50,000t from Australia, incl. ASW at mid $370s per tonne fob, APH at mid $400s per tonne; and 28,000t CWRS from Canada (13.5pc) at $382.59/t fob. 

Australia

Local markets were mixed on Friday and will be guided by offshore movements today with the expected jump in prices as the market reacts to Russia pulling out of the export deal.

After a couple of warm sunny days unfortunately the rain has returned today with showers expected to continue throughout the week for most of the eastern grain belt and SA.

Harvest is well and truly underway but will be interrupted this week by wet weather. Quality is reportedly pretty good and oil content of canola also good for what has come off so far. 

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