Canola had another big trading day, firming about 3pc. US wheat and corn and Black Sea wheat markets firmed 2pc, MATIF wheat eased. Soybeans, meal and oil firmed 1pc.

• Chicago wheat May contract up US25.75cents per bushel to 1010.25c/bu;
• Kansas wheat May contract up 24.75c/bu to 1037.75c/bu;
• Minneapolis wheat May up 19.75c/bu to 1085c/bu;
• MATIF wheat May contract down €1.50/t to €363.75/t;
• Black Sea wheat July contract up $7.25/t to $354.50/t;
• Corn May contract up 15.5c/bu to 750. 5c/bu;
• Soybeans May contract up 19.5c/bu to 1602.25c/bu;
• Soybean meal was down 4pc;
• Soybean oil up 2pc;
• Winnipeg canola November 2022 contract up C$32.10 /t to $1002.30/t;
• MATIF rapeseed November 2022 contract up €20.50/t to €789.50/t;
• ASX July 2022 wheat contract up A$1/t to $393/t;
• ASX Jan 2023 wheat contract unchanged at $395/t;
• AUD dollar firmer at US$0.754

International

A left/right combination struck markets overnight. The atrocities in the Ukraine have the market assuming a new level of even more restrictive sanctions are on the way. If nothing else the accusation of war crimes would add to the longevity of existing sanctions. We are left debating whether new sanctions could impact agricultural products.

US crop conditions are making news again, and the news is bad. The US winter crop was rated 30 per cent (pc) good-to-excellent; of which the Hard Red Winter wheat states’ good-to-excellent ratings were around 23pc. Note that USDA categorises winter wheat as one, not as HRW and SRW. The good-to-excellent rating for SRW is about circa 55pc, but the states of Texas and Oklahoma ratings are a shocking 13pc and 17pc respectively.

Saudi Arabia bought 625,000t hard milling wheat at US$422.47/t CNF. That price would equate, very roughly, to A$455-465/t track price in Australia for arrival September to November. That delivery period and price would probably be do-able out of the north for new crop but would be tight. Australian H2 price bids to growers presently for new crop are about $425/t.

The corn balance sheet is tight as a drum and the reliance on the US to produce feels very much like a jack in the box after 25 spins. Depending on your feed and export assumptions the US yield needs to be around 179bu/ac to break even. That can happen for sure but should conditions prove challenging during the growing season the market will add risk premium hard and fast (yes, we have done some of this work already).

Discussion about easing global grain supply concerns was addressed by the Secretary of the USDA, Tom Vilsack, saying opening up statutorily controlled Conservation Reserve Program (CRP) land to crop production would not be a viable option to ease global grain supply concerns amid the war in Ukraine. “CRP acres are disproportionately non-prime cropland, with more than 75pc of acres from less productive, non-prime farmland…additionally, a considerable proportion of currently enrolled CRP acres are in areas experiencing significant levels of drought,” Mr Vilsack said, in a letter to National Grain and Feed Association president and CEO Mike Seyfert.