Markets

Daily Market Wire 4 February 2022

Lachstock Consulting, February 4, 2022

Markets made small, mostly downward moves overnight.

  • Chicago wheat March contract down US14 cents per bushel to 755c/bu;
  • Kansas wheat March contract down 16.75c/bu to 769.5c/bu;
  • Minneapolis wheat March down 7c/bu to 908c/bu;
  • MATIF wheat March contract down €5/t to €264.25/t;
  • Corn March contract down 12.25c/bu to 622.5c/bu;
  • Soybeans March contract up 16.75c/bu to 1545.25c/bu
  • Winnipeg canola May 2022 contract up C$0.40/t to $1009.10/t;
  • MATIF rapeseed May 2022 contract down €5.25/t to €716/t;
  • ASX March 2022 wheat contract A$2/t weaker at $358/t.
  • ASX Jan 2023 wheat contract $1/t weaker at $356/t.
  • AUD dollar firmer at US$0.714.

International

Black Sea wheat was down US$1.25/t.

Black Sea wheat was down US$1.25/t. The Dow Jones Industrials Average retraced 1pc after almost a week of daily rises.

USDA data for sales to the week ended January 27 states 160,000t of wheat, 1.1 million tonnes (Mt) of corn and 1.98Mt of beans was exported. This is supportive for soybeans, bearish for wheat and a push for corn.  The market preferred to focus on the fact 380,000t of old-crop corn to China was cancelled. As with all export sales announcements, there was also plenty of talk that the cancellation could shift to new crop.

Soybean weather is the main driver of sentiment at the moment, and today sees a wetter outlook. Northern Brazil is very wet, which will impact harvest pace but is positive for safrinha corn production. Southern Brazil is set to record near-normal rainfall but reports are mixed for Argentina , from half of normal to normal.

It is hard to find anything about Russia today aside from how much snow it has covering its winter crop. The push-pull between geopolitical tension and the tax effect on flat price versus what looks to be close to ideal crop conditions will play out until the headers roll

Sea freight is showing signs of trying to find a bottom. US to Japan rates as an example were quoted at USD$62.50/t, down 11 per cent from the beginning of the year. While this is somewhat linked to the Chinese New Year, over the next 10 days there are 52 bulk grain vessels due to load from the US, down 20pc for the same period last year.

Australia

Local wheat values slipped a fraction yesterday through the trade markets while grower bids remained largely unchanged. The ASW1 flow in Western Australia continued to trade while it struggled to find a bid on the east Coast with most domestic end users getting their fill of SFW1 at A$30/t under ASW1.

Barley remains well supported in the market with a solid export program on the stem. We continue to see prices in South Australia port zones elevated, with barley bid $300-$310 port zone range. Malt premiums also remain strong at $30-40/t above feed along the east coast

Canola continued to strike a bid yesterday, with buyers stepping back in as we saw values lift $5-$10/t along the east coast. The SA and WA canola markets were also firmer by $10/t.

A clear run of weather for the next eight to 10 days is good for the sorghum harvest, and also helps the execution program for end users and exporters gaining access to sites around the country.

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