Markets

Daily Market Wire 4 May 2021

Lachstock Consulting, May 4, 2021

Mixed markets overnight in wide day-trading ranges. Corn closed 1 per cent higher and wheat 2pc lower.

  • Chicago wheat July contract down US16.75c/bu to 718c;
  • Kansas wheat July contract down 15c/bu to 688.5c;
  • Minneapolis wheat July contract down 5c/bu to 758.75c;
  • MATIF wheat September contract down €3.50/t to €215.75/t;
  • Corn July contract up 6.25c/bu to 679.5;
  • Soybeans July contract down 10.25c/bu to 1524c;
  • Winnipeg canola July contract down C$4.70/t to $864;
  • MATIF rapeseed August contract up €7.25/t to €511.25/t;
  • US dollar index down 0.3 to 91;
  • AUD firmer at US$0.776;
  • CAD weaker at $1.229;
  • EUR firmer at $1.205;
  • ASX wheat July contract up $9/t to $318/t;
  • ASX wheat January 2022 up $9/t to $321/t.

International

A day in the red – Chicago wheat traded to a high of 753.5usc/bu before settling at 718usc/bu, down 16.75usc/bu on the day. Kansas and Minni fell 15usc/bu and 5usc/bu respectively while corn managed to finish in the black at 679.5usc/bu, 6.25usc/bu higher. Despite the warm temps through the US and the risk that beans are losing acres to corn, July soybeans lost 10.25usc/bu on the day. Better moisture prospects in the EU pushed Matif wheat down EUR3.5/t to close at EUR215.75. In outside markets the dow finished 238 points higher, the AUD fell slightly to close at .7760 and crude oil snuck higher by 93usc/bbl.

The weekly planting pace and condition report summary was as follows:

  • Winter wheat conditions were down 1pc to 48pc rated good-to-excellent
  • Spring wheat was pegged as 49pc planted, a massive weekly gain of 21pc.
  • Corn was estimated as 46pc planted vs 36pc average and 17pc last week
  • Soybeans are 24pc planted vs 8pc last week.

A huge trading range overnight ended with the market in the red.

The unavoidable backdrop of a drought-ravaged Brazilian corn crop and all the growing risk in front of the US row crop belt requires risk premium.

Global wheat production is getting closer to known and, with the exception of the Canadian prairies and the US spring wheat belt, it’s hard to find meaningful areas of concern.

It seems every USDA WASDE carries some interest but it’s hard to remember a report with so much work required. The USDA still has Brazilian corn at 109Mt vs the street now sub-100Mt, with an easing bias.

US corn exports for old crop also look like they need some adjusting with 40Mt already going out the door vs the USDA estimate of 45Mt and just under 4 months still to run.

Australia

Kicking off the week local markets are spiking a tad higher on new crop, but the bids and offers remain wide; ASX Jan 22 market closed at $321/t.

New crop canola markets also started the week up with delivered bids into the crushers Geelong/Melbourne around $740 level; growers along the east coast will want to see some more rainfall on crops before another round of sales.

Current crop markets remain the same old story with prompt wheat bids paying a premium into port. We saw barley catch a bid early in the day through Victoria in the upcountry BHC sites.

Rain has been patchy thus far for southern NSW and has not eased concerns for plant establishment.  Growers are hopeful there is more coming through today.

Offers to the market have been limited with growers in sowing mode. Short term (2 weeks out) freight continues to be the golden ticket as delivered port market continues to trade at a premium. PKE, in particular, at $10/t over Newcastle.

 

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